Barbara Pocock (SA, Australian Greens) Share this | Hansard source

The Treasury Laws Amendment (2023 Measures No. 3) Bill 2023, amongst other things, enhances the tax office's powers to deal with applications for the First Home Super Saver Scheme. These are sensible enough changes, as my colleagues have said. We won't oppose them. But they do raise this important issue about the affordability of housing supply and the housing crisis. This policy is just another demand-side measure that pushes up property prices while home ownership is going down at the same time.

As an economist, I know that any measure on housing that increases spending will have the very simple effect of increasing the price of the commodity, increasing demand and pushing up those prices. Without a massive increase in supply, the problem just gets worse.

But it is especially worse and getting much harder for young people. Our young people are negatively affected across our country by what we're witnessing in the housing market. I'm a member of a generation, like so many in this place, who could, as with many other generations, afford to buy a house, to take out and meet the cost of a mortgage on an average wage. This is now beyond the current generations of 20-, 30- and 40-year-olds who cannot buy a home. Their circumstances more broadly are also much worse than previous generations' circumstances. Many of them carry very significant HECS debts. That gets in the way of taking out a mortgage. Many have spent many years employed in insecure jobs, many of them low paid. A quarter of our labour market is in insecure work, in casual jobs in particular, and young people are especially affected. We also recently saw in the 2023 Intergenerational report demographics coming down the pipe, which means we expect these young people, who struggled so hard to get in the labour market on insecure jobs and to accumulate assets and income, to pick up the demographic tab to look after the older generations and the demographic changes that are really significantly going to affect spending in our country in the generations ahead. The Intergenerational report laid all of that reality out, and the costs for future generations are very significant.

In my state, housing prices have gone through the roof. In South Australia, we are in the midst of a massive crisis both in homeownership and in the rental market. I ride my bike very regularly through the parklands around Adelaide, and we also have a very significant and growing crisis of homelessness on the streets of our city. We need to deal with these questions in a way and at a level that we have never done before, and the Housing Australia Future Fund is an inadequate response, as is increasing the demand through measures like that proposed in this bill. Housing cannot be seen as an asset class, a product for the means of accumulating wealth, as opposed to a roof over people's head to meet the basic need of a decent life.

Without a home, it's incredibly difficult to hold down a job. It's very difficult to raise a family and look after the people you love, and you cannot form a community without housing security. A first homebuyer support measure like this—a tweak—won't make a real difference to housing affordability, especially for young people. It will instead drive up prices.

Housing affordability in South Australia has never been worse, as a new report revealed in recent days. It now takes six years to save for a deposit, and most homes are out of reach for the average person. This is a really damning problem in such a wealthy country. We have a housing affordability index where the latest data, released just last week, reveals that housing affordability is at its worst level in at least three decades in South Australia. According to the index, mortgage repayments for a median-priced home as a share of income are now at a record high, well above levels in 1989, when I bought a home, and higher than the previous peaks in 2008. Repayments on a median-priced home are at $575,000. This figure is an average of all houses and unit sizes across South Australia in the past 12 months. They have now surged to 35 per cent of the average household income, the highest level on record. Of all homes sold in the last 12 months in South Australia, median-income households—that's those earning around $87,000 a year—could afford just 13 per cent. But the choice is much worse for people who are on lower salaries. For example, on the bottom 20th percentile, those people earning around $41,000 could afford just three per cent of homes in our state.

Housing affordability is beyond the reach of so many South Australians now. As I said, it takes a little longer than six years to save just a 20 per cent deposit, compared to about 2½ years in 1990. And high rents—rents that we've never seen before in our state—make it absolutely impossible for too many young people to save a deposit and to begin to work towards homeownership. Any kind of increase or more accessibility to the First Home Super Saver scheme won't save them, and neither will the HAFF. It is not enough to deal with the crisis that we face. This recent report on housing affordability in South Australia said:

This deterioration in affordability has been driven by a dramatic rise in mortgage rates, combined with rising home prices over recent years.

It's incredibly challenging for young people or anyone else who's trying to get into the housing market, and it is a major driver of intergenerational inequality. We've heard real estate agents and the real estate industry saying that when a relatively affordable home comes on the market, investors jump at it as quickly as first home buyers, and a lot of times the investors get there first and pay more. That puts a lot of pressure on first home buyers who are competing with a large pool of buyers who are chasing an asset not a roof over their heads. The buyers are still there; they're frustrated, and young people, in particular, are missing out.

We know that, over recent decades, wage growth simply hasn't kept up with skyrocketing property prices and skyrocketing rents, so saving for a deposit, especially when the cost of everything is going up very fast around everybody, is a major barrier for our first home buyers. Buying a home is out of reach for too many Australians, and the HAFF will not fix it. We need policies that build more public and affordable housing while also taking the heat out of prices, which requires ending negative gearing for multiple properties and cutting the capital gains tax discount. This super home saver simply adds to the problems of induced artificial demand, propping up investors who get to reduce their income tax by running a loss on the rent and then get to boost their profits when they sell a house by only paying 50 per cent capital gains tax. To put it another way, the tax you pay on selling a property is half what it would be if you earned the same amount from a job. With our tax system you pay more tax on income from work than if you speculate on property, and that is just wrong.

We have to fix our tax system. We need to build a lot more affordable houses across our country, and we need to cap rents so that people can afford a rental property and have a shot at accumulating a deposit so they can move into homeownership. And we need to stop looking at housing as an asset for the wealthy to accumulate more wealth. It is vitally important to adjust society for an inclusive society for a decent life for people across the income scale, and it is absolutely vital if we're going to be serious about addressing the widening intergenerational inequality that characterises our country.