Maria Kovacic (NSW, Liberal Party) Share this | Hansard source

I also rise to take note of the Community Affairs References Committee's final report titled The worsening rental crisis in Australia. I'd like to begin by thanking all the witnesses who attended the in-person hearings and the thousands who sent written submissions for this inquiry.

Australia is facing a cost-of-living polycrisis under this Labor government. The price of groceries and fuel, along with interest rates and rents, have all skyrocketed under the Albanese Labor government. As a result, the dream of homeownership is slipping away for many young Australians as they're firmly placed into the rental trap. This creates a toxic cycle. More renters means more pressure on the rental market, which means higher rents.

I believe you must fix the homeownership crisis if you are to fix the rental crisis. Both require a substantive increase in supply. We heard during the public hearings the overwhelming view that supply was the issue. In Brisbane, Ms Caniglia from Q Shelter explained exactly how the housing market works when she said:

Housing is a system, and at the moment we don't have enough supply to meet demand. That causes not only an incredible set of repercussions for households seeking to rent in the private market but also these other repercussions which make it difficult to deliver human services.

This sentiment was repeated at the Canberra hearings by REIA, when they put on the public record:

It is REIA's strong view that it is a shortage of housing supply that is causing this catastrophic situation for renters.

But you don't need an economics degree to understand that, if you have fewer houses than there are people, the cost of housing will go up.

Another thing this report did was to comprehensively rule out rent freezes and caps as a solution to this crisis. They simply do not work and often come with unintended consequences. In their joint submission, Treasury and the Department of Social Services explored academic literature that investigates the impacts and effects of rent caps and freezes in international jurisdictions such as New York and Berlin. Treasury concluded that, while controls on rental prices may deliver benefits to existing tenants through lower rental prices, achieving the policy objectives of price intervention is difficult, as it limits labour market mobility, is inequitable, imposes negative externalities, negatively affects the quality of rental stock, imposes costs on future renters, and leads to a reduction in rental supply and an increase in rental costs in the long term.

What was also gleaned from this inquiry was that all Australian governments must be bold in their desire to fix these crises. Stamp duty reform must be at the top of the agenda for state and territory governments. As the Grattan Institute said during the Melbourne hearing, housing would also be better allocated if more state and territory governments swapped stamp duty for a broad-based land tax. Stamp duties are amongst the most inefficient taxes available to the states and territories. They discourage people from moving to housing that better suits their needs, and sometimes they discourage people from moving to better jobs. My home state of New South Wales tried this, but, sadly, Labor once again decided to stymie reform what is Australia's worst tax. This is a critical tax reform. We could lower housing prices by possibly four per cent if states and territories reformed stamp duty.

What we also discovered is that the rent trap is preventing renters from saving enough for a deposit, further killing off the dream of homeownership for millions of young Australians. That is why the coalition believes that, if we are to revitalise the culture of homeownership, Australians who are first-home buyers should have the ability to access super to purchase their own home. It is, after all, their own money.

It is our view in this report that, to fix the rental crisis, the government must address the homeownership crisis that is trapping millions of young Australians in the rental market. We can achieve this by working urgently with state and territory governments to increase the supply of housing, including with stamp duty reform. We should be bold and find alternative ways in which first-home buyers can enter the property market, such as the use of their super as a deposit and then offset of super for their mortgage. We must strongly oppose policies that seek to destroy property rights or place them in the hands of institutions or to intervene in the market through measures such as rental caps or freezes. These actions will only make matters worse. Australia is a homeowning democracy, and, by prioritising the opportunity for homeownership, a key measure will develop in solving the current rental crisis.

I seek leave to continue my remarks later.

Leave granted; debate adjourned.