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Aug 30, 2012

AAH releases a 4-point plan to fix our housing crisis

A coalition of national housing, welfare and community sector organisations is proposing a four point plan to address affordable housing in Australia that will deliver 30,000 new affordable housing units each year and lift 250,000 households out of housing stress over five years.

The plan would deliver affordable housing options for two out of every three people currently on public and community housing waiting lists, as well as take pressure off house prices and ease demand in the private rental market.

Australians for Affordable Housing are urging Australia’s Housing Ministers to consider the proposals at the meeting of the COAG Select Committee on Housing and Homelessness in Perth tomorrow (Friday).

“Housing is the single biggest household cost in Australia and, over the last 25 years, housing costs have been taking a bigger bite our of the household budgets – up as a proportion of spending by 41 per cent in that time,” said Australians for Affordable campaign manager Sarah Toohey .

“By contrast we actually spend slightly less on energy bills than we did in 1984. Yet while we hear increasing outrage about the burdens of power bills, political parties are not calling for similar action on our housing affordability crisis. The cost of living debate in Australia is missing a huge part of the equation. The cost of living debate should be a cost of housing debate.

“The Australians for Affordable Housing plan we are releasing today outlines the pathway for governments to act on our housing affordability crisis. It includes:

1. Increase the supply of affordable rental housing:

  • Establish an Affordable Housing Growth Fund that would fund at least 20,000 new low-income rental properties each year. Cost: $1.4 billion over five years.
  • Double the number of property incentives under the National Rental Affordability Scheme. Cost: $1.1 billion over five years.

2. Improve housing affordability through tax reform:

  • Change the tax breaks for housing investors, like negative gearing and capital gains tax discounts. Saving: $5 billion over five years.
  • Help state governments to abolish stamp duty and introduce a broad-based land tax.

3. Improve rent assistance:

  • Establish a Productivity Commission review to enhance the effectiveness of Commonwealth Rent Assistance.
  • Increase the current maximum rate of Commonwealth Rent Assistance to restore its real value to the household budget. This would be an increase of between $22 and $27 per week, depending on household type. Cost: $6 billion over 5 years.

4. Set benchmarks for all levels of government to deliver affordable housing:

  • Develop a national housing and infrastructure plan, with transparent funding and accountability arrangements.

“Because of its complexity, we cannot simply expect the housing system to fix itself, nor can we rely on the market or on the quick fix solutions of the past, like First home Owner Grants and land release. We need innovative solutions, a national commitment, and a growing understanding amongst the community that this housing affordability crisis hurts us all.

“Our housing system used to support people to get a roof over their heads, but now we have one in ten households struggling with high housing costs. This must be a priority for governments and we’re urging Housing Ministers to tomorrow to renegotiate the National Affordable Housing Agreements to make sure it delivers for all households.”

Click here to read the full blueprint for change.

Media contact: Sarah Toohey, 0427 563 989.

Follow AAH on Facebook at www.facebook.com/housingstressed and Twitter: @housingstressed

  • Ji

    I have a little problem with the growth fund where the government buys in a certain percentage of the property because this can be subject to abuse.  This is like the first home owners grant that will just increase the price of the property not by the Aud7k or Aud15k but by the amount of government’s contribution.  So basing on the example of a 370K house where government will invest 40% or Aud148K – the unintended consequence is that the property will now be priced as Aud370K + Aud148K = Aud518K.  I would lean towards a report I read that Investors should not be allowed to have a 100% refinancing of their investment – there should be at least a 20% equity in buying a house as investment.

  • Kp63

    Congratulations on presenting solutions rather than just trying to point out the problems!

  • Mmmm. Need to think about those in mortgage stress as well.
    1. As part of the move to a broad based land tax, make interest on your PPOR mortgage tax deductible.

  • Pingback: Greens: Greens urge Ministers to take bold action on housing affordability « The Good Oil()

  • Lisa

    Did they consider the proposals last week? From what I saw on their website, it didn’t look like it…

    • grindstone cowboy

       good to see the experts are only considering mickey mouse tinkering the edges  stuff for solutions. doing something  real like getting rid of zoning restrictions, development levies ,neg gearing and other handouts would harm prices. think of the poor landlord their whole retirement future depends on rising rents and capital gains

  • Pingback: It’s time to abolish negative gearing | UOW Staff – News & Info for General Staff()

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