Thanks Professor Quiggin from supplying that quote#fn1">1 from our PM. It confirmed that renters do not count amongst John Howard's concerns and that is why they are forced to subsidise, with their taxes, the cost of private home ownership. This includes, amongst many other things, the first home owners' grant and rental assistance for welfare recipients. In both cases the money simply helps further fuel the housing hyper-inflation rather than help to make housing affordable.
I think this debate largely misses two other key factors which have been even more critical in forcing up the cost of housing in recent decades.
1. Much of the cost of housing is in fact the result of the privatisation of the housing market begun by Menzies.
The government-owned Housing Trust of South Australia never cost South Australian taxpayers a cent, yet for decades was able to provide affordable good quality housing to all sectors of South Australian society. Money that would have been unproductively invested in property speculation in the Eastern states was, instead, directed towards establishing viable manufacturing industries in South Australia.
2. That high housing costs are a consequence of high immigration
High immigration now at unofficial, but real and stratospheric href="http://www.smh.com.au/news/opinion/backscratching-at-a-national-level/2007/06/12/1181414298095.html">300,000 per annum deliberately brought about by the supposedly 'strong border control' Howard Government to suit the needs of property speculators, property developers and dependant industries. There is abundant evidence for this coming out of the mouths of the land speculators themselves. For example read www.realestate.com.au or read this from a 1973 submission by a property developer to the National Population Inquiry:
A large number of industries, including the building industry could not have developed to their present size without the immigration policy ... Population growth promotes expansion in building activity.
This is the mainstay of our economy, which as opposed to that of Japan, is substantially concentrate on national infrastructure rather than purely on export industries.
- cited in "The Growth Lobby and its Absence : The Relationship between the Property Development and Housing Industries and Immigration Policy in Australia and France" p114 of Sheila Newman's Master's thesis of 2002 downloadable from candobetter.org/sheila
As Queensland Deputy Premier Anna Bligh recently put it :
"The only way we could really (stop population growth) is to put a fence up at the (Queensland) border, or to cancel or freeze all new home building approvals," she said.
"That would have a very serious impact on the construction industry that a lot people rely on for jobs."
Remember, this is the 'left wing' female ex-student-activist Deputy Premier of the 'Smart' State speaking.
So we need to grow population in order to provide jobs for those already living here. And of course, tomorrow all of today's new arrivals will depend upon yet more new arrivals in order to create jobs for them. And the day after tomorrow all those newer arrivals will depend upon yet more new arrivals to create jobs for them, and so on until we are all only permitted to consume 5 litres of water a day each and are living stacked on on top of each other all the way up to the mesosphere in concrete boxes.
And, of course, as Professor Quiggin has pointed out, those who have invested in the hyper-inflated housing market expect the value of their investment to be at least maintained, if not increased. How else is this to be achieved without a constant flow of immigration?
How could anyone possibly question the economic capabilities of the various Governments which have brought about these circumstances?
I haven’t met anybody yet who’s stopped me in the street and shaken their fist and said: "Howard, I’m angry with you, my house has got more valuable."