Adam Bandt (Melbourne, Australian Greens) Share this | Hansard source

About seven years ago, not long after being elected to this place, I went out with my now wife to look at buying a house. I'd previously bought a unit in Parkville, Melbourne, where I live, and we were then looking for a larger place around Melbourne. We went to quite a few auctions. As we went to those auctions, we kept seeing one person pop up every time. Every time this person was at the auctions, just when it got to the point where someone who, you could tell, was going to move into that house was about to buy it, she'd stick up her hand, increase the bid and say, 'I'm going to bid even more.' At one auction, she sat there, sticking her hand up time after time, buying on behalf of someone else, pushing the price up and up. We went to half-a-dozen or a dozen of these auctions, seeing the same person or similar people there every time. You could sense and tell that all of the people who wanted to buy a house to move into were sitting there and thinking: 'What can we do? We can't outbid this person. We don't know who they are, but we can't outbid them.'

It became apparent that this person doing the bidding, and winning these houses by pushing the price beyond where people could afford, wasn't about to move into the house; it was a property agent. They were there buying it on behalf of someone else. It became clear to us that they were bidding up the price of housing so that first home buyers couldn't get in, because they were buying on behalf of someone who could then take the house, rent it out and, if they made a loss on renting it out because they'd paid too much, write that loss off for a tax discount. Then in a few years time—so the agent was advising them—they could sell the house and get a tax break on that as well.

It was becoming crystal clear, as we were going around auction after auction and being outbid, that we were being outbid by people who had no intention of coming and living in these houses, starting a family in these houses, perhaps living close to where they worked. They were being bought by people who could rely on a tax system, which this place presides over, that would write them out cheques for buying their second, third or fourth house, at prices that put it out of the reach of first home buyers. Meanwhile the people who wanted to live in the house and buy their first home weren't able to do it.

That's what we have in this country. We have a tax system that rewards people who already have a house and says, 'We will give you billions of dollars in subsidies every year for you to buy your second, third, fourth or fifth house, and we don't care if that pushes up prices so much that aspiring first home buyers can't ever even buy their first.' This is coming from someone who's on a politician's wage, and my wife was working at the time as well. If a politician, earning the very good money that we do, whose partner is also working, can't even afford to buy a place near where they want to live, because the government is subsidising someone else to come in and buy that very same house as a tax write-off, at a cost to the federal budget, then the system is broken.

It is no wonder that I meet people in my electorate every week who have just given up on the hope of ever being able to afford to buy a house and those who have given up even being able to rent a house in inner-city Melbourne, near where they live or study. It's because we have this massive bubble that the tax system is pumping up and up, driven by negative gearing and capital gains tax. It means you can come in and buy a house and pay as much for it as you want—if you are lucky enough to have the money for it—because you can write-off your losses from it as a tax write-off, and then when you sell it you can get a tax break at the end, as well. It keeps the property agents, the accountants and the tax planners in business, because they develop these schemes that price everyday people out of the market. It means that if you have a couple of houses already you're doing all right. And I will tell you what: there are lots of people in this place who have quite a few houses and who take advantage of that lurk. But it comes at the expense of first home buyers.

In the 1990s the average house price was six times an average young person's income. If you finished university and went out and tried to buy a place it was about six times your average income. Fast forward to 2013 and it's 12 times an average young person's income, and it's gone up and up since then. At the same time, over a very similar period, the share of wealth that young people have in this country has gone down from about 10 per cent to about five per cent, and that's falling as well.

So we've got a huge problem in this country. The pea under the mattress that means no-one will get a good night's sleep until we remove it is the tax system—the tax system that rewards those who already have by giving them more at the expense of first home buyers. So we need to get rid of negative gearing and we need to get rid of the capital gains tax exemption which says that if you have the misfortune of having to earn your income by working you have to pay the full freight of tax but if you are wealthy enough to earn your income by being able to buy or sell houses or shares we will give you a 50 per cent tax break. We've got to get rid of that. That is going to start to make housing more affordable for people and it will mean the government will find more money for paying for things like schools and hospitals, to the tune of about $5 billion a year, if we do it right. If we wind it back right, we could find ourselves bringing in an extra $5 billion a year.

What should we do with that money? Well, it's time for a mind-shift in this country—not to do the kind of measures that the government is talking about in this bill, which is not to take away the tax breaks but to add more tax breaks into the system in the hope that somehow that will fix it. No. We need a mind-shift. We need to start thinking about housing the way we think about schools and hospitals. If there were 200,000 children being turned away from schools because not enough schools had been built, we would think it was a national scandal. If there were 200,000 people who couldn't get into the hospital in their local area because there weren't enough hospitals, we would think that was a national scandal. We need to start thinking about housing the way we think about Medicare. We need a Medicare for housing. Housing is a human right. It is not an opportunity to make a huge amount of profit. It is not something on which this government should be spending $5 billion a year giving tax breaks to people who have already have a house to go and buy their second, third or fourth. No. Let's think about housing the way we think about schools. Everyone deserves to have a roof over their head, in exactly the same way as every child has the right to go to a government school. In the same way as we would say that if you can't get into school we should build more schools and if you can't get a bed in a hospital we need to build more hospitals, it's time for the government to say that if you can't get an affordable house and a roof over your head it's time for the government to step in and build them and to make sure it happens. We need to think about housing the way that we think about Medicare.

That's what the Greens are campaigning on in Queensland at the moment—a home for all. We need to start thinking about housing and a home for all as a human right. They're pushing for a new Queensland housing trust that will start building a million affordable homes, that will create 16,000 jobs per year for 10 years and that will give people a home for life, and when you build the homes you get the rent that people pay on those homes and you plough that back into the system so that the system can continue.

In states like mine, in Victoria, we've suffered from the mining boom that drove up the dollar and put huge pressures on manufacturing. We've got 40,000 people, nearly, on the waiting lists for public housing, and if you're in the top category in Victoria you could be homeless for a couple of years before you find yourself a spot in public housing, but we haven't built more public housing on any large scale since the 1960s. What better way to deal with high youth unemployment and a rising homelessness problem than to engage in a large-scale build of affordable housing for people who are currently being locked out of the market?

We've got factories in Brooklyn and elsewhere in western Melbourne where they're creating modular homes on, largely, assembly lines in many places and doing amazing stuff. I've been down to Morwell where they've got a potential crisis facing them with unemployment, and we have the closure of Hazelwood Power Station and the potential closure of other power stations. Why not say that in the Latrobe Valley we will fund you to build affordable homes—perhaps even modular homes that we might ship up to Melbourne to house the people who are currently without an affordable home—creating jobs and homes in the process? So Australia becomes a place where everyone gets a roof over their head and where we do the two things that could start to make a real difference to housing affordability, not adding more tax breaks into the system for the wealthy as this government is proposing. It would actually do something real.

Firstly, we'd get rid of the tax breaks in the system that are pushing up prices to the point where people can't afford it anymore. Secondly, we'd do something that would start to drive rents and prices down, which is to increase supply of low-cost stock. At the moment, in my area of Melbourne, the general rule seems to be that if you find an old place, especially if it's an old warehouse in the city, knock it down and build on it the biggest, most expensive thing you can find. So we're getting more one- and two-bedroom units but they're out of the price range of many people. Let's start building properties that get rented out at less than market rent or that are sold only to people on lower incomes.

If I as a member of parliament with a partner who is working full-time find ourselves getting out-bid at auctions for very modest properties, then someone who is a cleaner coming into the city to clean the buildings at night—or a firefighter who works at a station or a nurse who works at a hospital—has almost no hope. Why don't we start building properties in the inner city for the key workers of the inner city, and say, 'You can only buy one of those properties if your income is below a certain point,' and the condition on it is it has to be resold at a certain amount? Why not start building some of the properties in the inner city and say we will only rent them out to people whose income is below a certain amount, and we'll rent them cheaply?

We've got a couple of trillion dollars floating around in superannuation funds. What a good place to invest them, in building affordable housing in the inner city. And then, when the government says, 'Well, we couldn't possibly start to think about housing the way we think about schools and hospitals and make it universally available for everyone,' I will remind them that there's $5 billion a year we could save by not giving tax breaks to people who've already got a house. Let's not give tax breaks to people who have a house so that they can buy their second, third or fourth house. Put $5 billion extra into the system and build more affordable housing. It will put housing back in the reach of young people and put renting a house back in the reach of young people. That's what a proper housing affordability strategy would look like.

Instead, because the government hasn't got the guts to tackle its base—the big donors who donate to it and the members of parliament who sit here with over a dozen properties in many instances under their name, while some people don't even have one; that's who this government is speaking for. Well, we will stand up for young people. The Greens will stand up for young people. The Greens will stand up for those who are being screwed over. The Greens will close the wealth gap that exists at the moment and push for real action to make housing more affordable for renters and for buyers. We will stand up to those vested interests, but the government clearly won't.

See this speech in context