It's all gone horribly wrong: young generation doomed to rent

July 03, 2018

Successive governments have tackled a housing affordability crisis in Sydney and Melbourne with a strategy that has “all gone horribly wrong” by favouring established homeowners with access to a “wall of money” ahead of market ­newcomers needing family-friendly dwellings, ­researchers argue.

The Australian reports, a study of census figures by the Australian Population Research Institute concludes a housing supply problem in Australia’s two largest cities is so acute that most young households cannot afford to buy homes in established suburbs — and will never experience the benefits of their parents’ generation. An argument supporting Conservative Party leader Cory Bernardi's calls for a halving of Australia's immigration intake.

Demographers Bob Birrell and Ernest Healy say the proportion of renters has risen steeply in response to the housing affordability crisis. While acknowledging there is no easy solution, they recommend reducing immigration as the best option to ease demand, along with a rethink of tax incentives that help investors but work against a younger generation of prospective buyers.

Another suggestion is to relax zoning constraints in suburbs, but only if there is “parallel action” on tax incentives and immigration.

The report by the academics with Monash University links appears to reinforce calls by Senator Bernardi for a significant reduction in immigration until pressures on housing and jobs ease. However, the Turnbull government is not inclined to radically curb the current intake.

To read Bran Norrington's full article, click here.

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