Marise Payne (NSW, Liberal Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Hansard source

I present the report of the Select Committee on Housing Affordability in Australia, A good house is hard to find: housing affordability in Australia, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

by leave—I move:

That the Senate take note of the report.

As this report’s title says, a good house is hard to find. By ‘good’ we mean ‘affordable’, not just in the narrow sense of the mortgage repayments or rent being manageable but in terms of its location affording its occupants reasonable access to work, schools, infrastructure and basic social amenities. The common measures of affordability show that these ‘good’ houses are indeed becoming harder to find. The average house cost about three to four times the average annual wage up to the 1980s but now costs more like seven years’ wages. A typical young family looking for their first home would find only about a third of houses affordable. This assumes that the family has an average income. Low-income earners now find there are many areas where they cannot afford any homes at all, and this is forcing some key workers into very long commutes to work.

A good house is harder to find for renters. There are more households in the private rental market suffering from housing stress than there are stressed home-buying households. Of course, suffering to the greatest degree are the 100,000 Australians estimated to be homeless.

The select committee held public hearings in all mainland capitals, not just in the central business districts but also in outer suburbs like Campbelltown, in New South Wales, and Narre Warren, in Victoria. Hearings were also held in regional centres such as Ballina, in New South Wales; Geelong, in Victoria; Launceston; and the very rapidly growing area of the Queensland Gold Coast. The most dire cases, though, of unaffordable housing we encountered were in the mining town of Karratha, in Western Australia, where we saw firsthand the quite extraordinary difficulties faced by people there who do not earn big salaries or have housing provided by their employers.

After several months of this committee process, and with the tabling of the report, it is now clear that there are no simple answers to the housing affordability problem. While recent rises in interest rates are making it somewhat harder for aspiring purchasers and putting pressures on recent buyers, the problem of housing affordability is more a structural one which has been increasing for many years—some would say for decades. The report describes a range of both supply and demand factors which have given rise to it.

Among the demand factors are rising incomes and strong population growth, greater availability of credit since financial deregulation, and, in a medium-term sense, lower interest rates and incentives in the taxation system. We have recommended the latter be addressed by the taxation system review panel. Among supply factors, on the other hand, there is a lack of skilled building workers, a lack of qualified planners and, in some cases, greatly excessive red tape impeding new land becoming available for housing. A further problem comes from stamp duties. They are quite simply an inefficient tax which impedes people moving to more appropriate housing. Furthermore, as they have not been indexed, they are a growing proportion of incomes.

As well as problems with the shortfall in the number of new houses becoming available, there is quite clearly a problem with the lack of diversity in new housing, and the committee received significant evidence on this matter almost everywhere we met for public hearings. All too often new developments seemed to comprise only large houses, perhaps with four bedrooms, two garage spaces and two bathrooms. It makes it very hard for low-income families to move into these areas and it makes some people take on much larger houses than they require at the time, with commensurately larger mortgages. Moreover, it also makes it hard for so-called empty-nesters to move to more suitable accommodation while they stay within their own communities, as so many wish to do, or for their children to live close by.

We have therefore supported in this report initiatives being taken by some governments to require new developments to have a range of housing types. The committee acknowledge that the government is currently introducing some new schemes. It is important, though, that housing measures add to the supply of housing, rather than just to demand. To this end, we have suggested that the First Home Owner Grant scheme should return to giving more support to the purchase of new rather than existing housing. As I mentioned earlier, the problem of affordable housing is not restricted to homebuyers. The report therefore recommends that more resources be provided for rental assistance and that its effectiveness be improved.

A number of recommendations in the report relate to increasing the supply of social housing provided by government and community organisations. One of the very heartening aspects of the inquiry was the good work being done by a significant number of community organisations in providing housing to those on low incomes. It is regrettable that the profile of residents of public housing has changed over recent years to cope with a much larger number of deinstitutionalised Australians and that, at the same time, public housing has not been supported with significant increased funding. As a result, it therefore has much less capacity to house low-income families who would, in the normal course of events, have hoped to be accommodated in public housing and who see a future for themselves perhaps in ultimately buying that house, as was the case decades ago. In the longer term, we have also received strong evidence that Australians are more likely to find good, affordable houses if the development of mid-sized regional cities is encouraged. The only way for that to happen, though, is for a sustained effort to be made by all tiers of government to improve infrastructure, including better transport links.

This select committee report, which I am very proud to have had the opportunity to work on, has a significantly large number of recommendations as well. It had terms of reference pertaining to housing affordability in relation to homeownership, but it became absolutely evident to committee members that, in the course of the proceedings, rental pressures, pressures in relation to social and community housing and other forms of support for those on much lower incomes in Australia were issues which we most certainly needed to consider as well, and I think we have done an effective job in examining those.

I want to thank all those who gave evidence to the inquiry and who provided submissions to the inquiry. We received, I think, over 100 submissions, many going to great depth and great detail, for which we are grateful. Because of the number of public hearings we held, we also had a large range of witnesses, some of whom had travelled a long distance—particularly those who met with us in Karratha in Western Australia. I also want to thank the committee secretariat, led by John Hawkins, which, at the same time as doing its other committee work, has carried the work of this select committee absolutely excellently, and I am very grateful for its professional support.

We have produced a unanimous report on housing affordability in Australia, and for that I thank all of my colleagues, who were a very important part of the committee’s considerations. In Australia, our problems of housing affordability have grown over a long period. I do not pretend that the report’s recommendations provide quick fixes. But in commending the report to the Senate, I do argue that it forms a basis on which to build longer term solutions so that Australians can find the homes to which they aspire.