Leith van Onselen quotes Saul Eslake:
Research by Judy Yates of the University of NSW shows that home ownership rates among younger age groups declined dramatically between the 1991 and 2011 Censuses – from 56% to 47% among 25-34 year olds; from 75% to 64% among 35-44 year olds; from 81% to 73% among 45-54 year olds; and 84% to 79% among those over 55…
Eslake also nails one of my pet hates: federal/state intervention in the housing market to boost demand, driving up prices and fueling the housing bubble:
Eslake puts the recent failure of housing supply to keep up with demand down to two main factors, namely:
- The decline in the provision of social housing; and
- Restrictive state and local government planning schemes and upfront charging for development and infrastructure.
Eslake is particularly scathing of policies that boost demand, such as FHB Grants and negative gearing.
Read more at Saul Eslake: 50 years of housing policy failure | | MacroBusiness.
One of my major pet hates is also ” federal/state intervention in the housing market to boost demand, driving up prices and fueling the housing bubble”.
But my take on it is the Federal government increases demand through a high immigration rate knowing full well what the existing pressures are. I’ve got no problem with a high immigration rate if we had the infrastructure to accommodate everyone. And State and Local government deliberately restrict supply for various reasons.
The problem as I see it is that rising real estate prices works very nicely for all 3 levels of government. Amongst other things the state and local government get higher revenues from taxes like stamp duty and section 94 contributions. And on a federal level the economy can appear to be better off because there is more credit/debt and more money going around.
What I’d like to see is government essentially getting out of the way and allowing a sensible supply level. Either that or put a limit on some of the demand. But not one party at any level has any intention of doing this.
And so the trend will continue with more and more people unable to enter the home ownership market.