Kate Chaney (Curtin, Independent) Share this | Hansard source

Australians know we face a growing housing affordability crisis. Young Australians are struggling to afford to buy or rent a home, and homeowners can see how hard it is, or will be, for their kids and grandkids.

At our housing forums in my electorate of Curtin, people said they want politicians and governments to stop the political point scoring and work together towards affordable and accessible housing. They said houses are homes, not just investment products.

It has taken 20 years of policy from both sides of politics to get where we are. Housing is now half as affordable as it was when compared to wages. There is no silver bullet to solve this problem. It won't be quick or easy, but it can be achieved if we have the wisdom and the will.

In Curtin, our 173,000 residents live in 76,000 homes across our 28 suburbs. We have about 7,000 vacant homes, 29,000 homes with more than two spare bedrooms, 2,000 social housing homes and 1,700 homes used for short-stay accommodation. About a third of our homes are owned outright, a third mortgaged and a third rented. My electorate of Curtin has substantially higher median house prices and rents in the Perth metro area. While some households are on high incomes and are able to afford these prices, younger households and essential workers are struggling to live close to their families, friends and workplaces.

So what are governments doing now about housing affordability? Both major parties have found that it's politically advantageous for house prices to increase because two-thirds of households own their home. Successive governments have served the interests of these owners, and we now have a growing gap between homeowners and people who can't get on the property ladder.

Current government strategies and policies to improve housing affordability are timid and slow. The National Housing Accord announced in October 2022 has not been fully implemented, and we're not on track to meet the targets for homebuilding. Direct government funded homebuilding under the accord is limited. There are 10,000 affordable homes to be built by state and territory governments. The WA allocation of this is just over 1,000 new houses. If this was distributed equally across WA, which is unlikely, that would only be 70 houses in Curtin. The WA state government has seized most planning authority from local governments in an attempt to drive more infill, but many communities are justifiably concerned about massive apartment blocks towering over quiet neighbourhoods.

So which policies work? Effective housing policies can address two issues: how many homes are available, and who gets them. Right now, we need to increase the supply of available housing, but we should also try to make housing policy fairer. I would like to outline 13 policies that I think are most worth pursuing—seven that increase supply and six that make housing fairer. With some strong political will, we can make substantial inroads and improving housing affordability both now and for future generations.

Firstly, here are seven policies to increase housing supply. One: we need more infill done in a sustainable way that builds communities we want to live in. This depends on consulting deeply with communities, so they are involved in the process.

Two: we need to boost government investment in social and affordable housing builds. Social housing builds have not kept pace with demand. In WA, there is currently an unmet need of more than 39,000 social homes. The current commitment under the housing accord would equate to only 1,000 new social housing builds in WA.

Three: we need to attract more workers to the housing construction sector. Construction trades should be prioritised in immigration, because strong employment conditions make it hard to expand the domestic construction workforce. Slowing down infrastructure spending would also reduce competition for the skilled workers we need to build houses.

Four: we need to encourage smaller homes to better match population needs. The average house in Curtin has three bedrooms, but the number of single-person households is now 19,000 and growing. This trend will increase as the population ages. Smaller homes provide downsizing options and are more sustainable and manageable if you live alone.

Five: we need to encourage better use of vacant homes. There are more than 7,000 vacant homes in Curtin, and some of these could add to housing supply quickly. This could be achieved through vacant-property rates, taxes or lower transaction costs.

Six: we should replace stamp duty with a broad-based land tax. Economists recognise that stamp duty is an inefficient tax, because it discourages households from moving to more appropriate homes when their circumstances change. While this is a state government responsibility, the federal government could assist in the longer-term transition to a land tax.

Seven: we need to reduce homebuilding costs through increasing construction industry productivity. Australian homebuilding costs are high, due partly to the fact that construction sector productivity in Australia has not improved in the past 30 years—partially driven by restrictive workplace practices and the failure to innovate. Industry and government should be looking for reforms to improve growth and speed up build times.

Next, we need to consider further reforms to make housing fairer. Here are six ideas worth pursuing. One: we could create a level playing field for homebuyers by reforming negative gearing and the CGT discount. Reforming negative gearing and the capital gains tax discount could change the mix between owners and renters. At current affordability levels, two-thirds of young people now despair that they will never own a home. Modelling shows that tax changes could shift between 2½ and five per cent of Australians from renting to owning, as renters would be bidding against fewer investors at auctions.

Two: we need to provide improved security of tenure to renters. More Australians are likely to rent for life and need secure tenure. Banning no-grounds evictions and limiting rent increases for existing tenants in line with local market changes would help. In Curtin, this would have particular impact in Scarborough, Subiaco and Wembley, which have the highest numbers of renting households.

Three: we should encourage institutional investment in build-to-rent. The build-to-rent bill has been stuck in the Senate, passing only this week. I visited Sentinel's build-to-rent project in Subiaco a few weeks ago and saw what can be achieved if we attract foreign capital into stable, high-quality, long-term rental product.

Four: we should increase the rate of Commonwealth Rent Assistance. Despite some increases in recent budgets, the rate of CRA has not kept pace with recent rental price increases. CRA should be increased for those in the greatest need while reforming the eligibility rules and improving targeting.

Five: we should reinstate the National Rental Affordability Scheme. NRAS was a jointly funded scheme between state and federal governments, but it's coming to an end. It was a good policy but was burdened by administration problems that could be overcome.

Six: we could encourage renting out spare bedrooms. There are more than 12 million spare bedrooms Australia wide and 29,000 homes in Curtin with two or more spare bedrooms, including 2,800 in Scarborough alone. Reviewing tax settings on renting out bedrooms and simplifying administrative arrangements could boost housing supply quickly.

Which policies don't work? Many policies put in place in the past or proposed for the future do not meaningfully improve housing affordability and, in some cases, actually make it worse or have other consequences that create additional problems. This includes first homeowner grants, dipping into superannuation, rent freezes, regulating short-term rentals in most areas, wholesale cuts to immigration, and freezing building standards. Some of these, like homeowner grants and dipping into superannuation, just put more money into the system, driving prices up. These policies are politically cynical and economically irresponsible. Others, like rent freezes, may reduce the supply of rental housing. Cutting immigration has significant implications for our broader economy, and freezing building standards would create homes that are more expensive to run for the coming decades if they're not energy efficient.

We need to act now. Many of the changes that I've outlined for consideration will take time to have an impact on housing affordability, but we need to get started. Implementing these reforms will require cooperation between different sides of politics and also between different levels of government. This will only be possible if political parties can put their differences aside and agree that long-term outcomes for the future of the country are more important than scoring political points. As an Independent, I'm open to ideas no matter where they come from. Right now, we need all the good ideas. Next week, I'll be hosting a housing workshop to test these ideas with my constituents as the next step in developing our Curtin housing policy paper. With some political will, we can work across politics and across different levels of government to fix this problem so young people and all Australians can aspire to secure an appropriate housing.

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