Carol Brown (Tasmania, Australian Labor Party) Share this | Hansard source

I also rise to take note of the same answer. As reported in today’s Sydney Morning Herald, household debt has climbed to a record 171 per cent of household income, and regular financial obligations, such as mortgage repayments, are now soaking up more than one-fifth of all disposable income. In my home state, Tasmanians pay over 30 per cent of their income in servicing their mortgage. We have seen interest rates rise seven times since 8 May 2002, and many hardworking families right across Australia are feeling the impact as they deal with the pressures of financing a mortgage or their dream of buying their first home.

We are also seeing homeowners losing their homes at a record rate, forced out by massive mortgage payments, rising petrol prices and high personal debt. And, true to form, the Prime Minister has looked around to find someone to blame for this national crisis of housing affordability. This is what we have here: a national crisis in housing affordability. Unfortunately, Senator Bernardi seems to have fallen for the Prime Minister’s line. The Prime Minister has looked around to find someone in his blame game and he finds the states—‘I’ll blame the states for my neglect, I’ll blame the states for my lack of leadership and I’ll blame the states for my broken promise on interest rates.’ We have now seen three rises since that promise was made, taking the tally to seven in a row.

The Prime Minister blames the states for failing to release enough land for new constructions. But housing expert Alan Moran—the Prime Minister’s own expert—has confirmed that the PM’s only solution, massive land releases, would slash home values by $100,000. This would leave struggling families in financial crisis, owing more than their house is worth. We see figures confirming our worst fears: that the chance of young families owning a home—the great Australian dream—is diminishing; they are being locked out of homeownership.

According to figures, the proportion of first home buyers in the market has hit a 12-month low, with just 16.7 per cent of all loans being for first homes. Families are struggling with rising petrol prices, rising prices at the checkout, rising education and health costs. Families are simply unable to afford the loan repayments that are now required.

Families have seen the Prime Minister’s promise on interest rates go up in tatters, it having already, as I have said, gone up three times. They know they cannot trust the Prime Minister on interest rates. The government’s answer to those families paying off crippling mortgages, which are now taking up a massive proportion of the family household budget, is to blame the states and put forward a now discredited policy on land release—a policy encouraging a massive land release campaign that will erode property values. That is leadership! I support Senator Carr’s statement:

As a result of the Howard Government’s neglect of the housing affordability crisis, the proportion of first home buyers has been below the long-run average of 20.2% for over four years.

These figures show that higher interest rates are hurting everyone—those who have taken on a mortgage because they just couldn’t wait any longer, and those who want to buy their own home but can’t afford it.

The states and territories do have a responsibility and they have each taken action. By contrast, the Howard government has reduced funding for housing programs and abandoned Australian cities, including abolishing Labor’s Better Cities program, which had a return of four to one in terms of government dollars spent. States and territories have unanimously supported the development of the framework for National Action on Affordable Housing and are working together to implement it. The government had to be dragged to the table to sign up to the framework and it has not committed to taking any concrete action.

The Prime Minister needs to show leadership on this issue, an issue critical to all Australians, by taking responsibility for the crisis. Appoint a minister for housing and start working cooperatively with the states and territories to fix the problem, instead of playing the blame game for your failures and attempting to dump all the responsibility on the states. Australians will not be fooled. The government cannot take the credit for house prices increasing but dump homeowners now that housing affordability has reached a crisis.

Unfortunately, we have already seen evidence of homeowners unable to keep up repayments and being forced to sell their home for less than it is now worth. This leaves families with a large debt and no home. The Labor Party will have a minister for housing who can focus on the housing market and ensure that homeownership stays within the reach of hardworking families.

The Labor party knows that to address the problem of housing affordability we have to work together. These measures are vital if we are to address the growing problem of housing affordability and if we are to ensure that the dream of owning your own home is not simply a fairytale that is beyond the reach of everyday, hardworking Australians. (Time expired)