General News
15 November, 2024
There are no easy answers to the housing crisis
Does Australia need a special 'tradies' visa?
Australia's housing shortage, which is closely linked to the cost-of-living crisis, will be front and centre at the federal election expected to be held in early 2025.
As polling day draws near, politicians of every stripe will undoubtedly turn up the heat on their opponents while arguing they are the only ones with the magic bullet to fix the problem.
While Labor has set itself the ambitious target of building 1.2 million new homes over a five-year period, it has yet to deliver anything much at all.
The Greens, who have rebranded themselves as the party of renters and are colluding with the LNP to stymie many of the reforms and measures Labor wants to implement, are advocating rent caps, the scaling back of negative gearing, and other regulatory interventions.
While this has popular appeal industry experts fear it would be counter-productive in that it would drive the private sector "build to rent" investors the government is pinning its hopes on away in droves.
The LNP, meanwhile, is still pushing ahead with its proposal to allow people to use at least part of their superannuation to fund a housing deposit.
While this may sound good in theory past experience with first-home buyer schemes and the like has shown making more money available for housing just drives prices up.
Given the market is already overheated the last thing anybody wants to do is to pour fuel on the fire.
It is also an unfortunate truth that when interest rate relief finally does arrive - possibly around the middle of 2025 - it will only really help existing borrowers.
Property prices will receive a boost, making it even harder for first-home buyers.
And don't hold your breath waiting for landlords to scale back rents in line with falling interest rates.
The upshot of this rather bleak outlook is that few, if any, voters believe any politicians know how to fix this mess.
That's why three in five of all Australians who are now renting no longer expect to be able to own their own home.
Given home ownership has long been regarded as the "Australian dream" and is seen as the cornerstone of a financially secure retirement this is alarming.
Homeownership rates, which have been declining since their late 1960s peak, are expected to fall from 67 per cent to 63 per cent over the next 20 years regardless of who wins next year's election.
The reasons for this are many and varied.
Affordability is at the top of the list. Research by the Australian Housing and Urban Research Institute has found that 51.5 per cent of private renters just don't have enough money for a housing deposit.
According to Build Skills Australia, six factors have made it increasingly difficult to develop infrastructure, including housing.
These include the skills shortage, complexities imposed by the transition to net zero, increased government regulation, the ageing population, and technological change.
The biggest hurdle, and the one that means Labor's ambitious targets will not be met, is the lack of skilled workers.
The BSA says while Australia will need at least two million construction tradies in 2025 the industry will come up at least 200,000 workers short.
Master Builders Australia chief executive Denita Wawn finds it amazing Jobs and Skills Australia's draft list of occupations to be covered by a new "skills-in-demand" visa didn't include plumbers, bricklayers, and cabinet makers.
She has called for Australia to follow Canada, the UK, and New Zealand by introducing a specific "tradie" visa.
That seems an eminently sensible proposal that deserves bipartisan support.