Without a mature discussion on population growth, the housing crisis will extend for years to come, according to Sustainable Population Australia (SPA). SPA National president Peter Strachan says there is deep denial within the government that population is the main factor driving housing demand.
"The housing market is facing the worst housing affordability ever - yet house prices continue to show extreme strength. So what's the housing end game when the majority of people can't afford a home - what's the future for house prices. This video features sections from the video: "If Nobody Can Afford A Home...
Every time I turn on ABC Melbourne radio I am confronted with problems about which I can do nothing. A friend of mine visiting from Thailand described this radio station as “a problem a day,” which resonated loudly with me. The latest problem which gets non-stop air time is “the housing crisis.” Then there is the problem of Melbourne's newer suburbs with only one way in and one way out, keeping cars waiting in long queues to exit on the way to work.
The property development and construction industry is having a lend of Australia: By promoting massive migration numbers, it keeps housing and land costs high and it keeps its own costs low.
The following is an excerpt from the Guardian, 14/03/2022, pertaining to Premier Daniel Andrews. Andrews also suggested the “great Australian dream” of owning a home was less important to younger generations, especially given the increasing cost of property – the median price of a home in Melbourne is now $1.1m.
Why, once again, does the ABC avoid the issue of population growth, the primary cause of housing affordability. It is simply a fantasy to believe that adding another 400,000 people to Australia's population every year is not relevant
What follows is the text of a complaint lodged with the Australian ABC regarding the bias in its reporting on housing in a series of segments on the 7.30 report:-
“This week, the 7.30 Report included 4 segments on the above subject.
Once again, the ABC avoided the key issue like the plague.
It can be argued that housing affordability is Australia's greatest problem. Thousands of young couples in particular are having to save for years and years to accumulate a house deposit while prices skyrocket. This puts relationships under strain, and means that they often have to put off having families until they are well into their 30s, while often having to pay back a large HECS debt, and repay large mortgage instalments at the same time.
And it is not only young people who are affected. There are many older women who are caught in a rental trap.And don't get me started on the desperately bad housing conditions being experienced by our indigenous folk.
None of your "contributors" to the segments offered any real solutions, apart from densification, which many people do not want in their neighborhoods
.
So why, once again, does the ABC avoid the issue of population growth, the primary cause of this problem. It is simply a fantasy to believe that adding another 400,000 people to Australia's population every year is not relevant.
The answer to the problem is to reign in this insane population growth. This is easily done by big cuts to immigration, and encouragement of small families.
This is not the first time I have raised this matter with you. Why do you avoid it. I refuse to believe that ABC researchers are not aware of the problem. It seems clear to me your reluctance to discuss population growth is idealogical, or perhaps you are frightened of being labelled racist. Proposing to cut immigration is not racist unless the proposer is advocating cutting immigration of particular races.
I have 3 children and six grandchildren. Two of my children have managed to break into the housing market, but the housing opportunities for the other seven are very uncertain, and a cause of worry for them as they enter into relationships and try and get on with their lives.
I am very angry that my family members are having to worry about getting a roof over their heads. My anger is made worse by the stupidity and ignorance of the political parties who will not acknowledge the problem. And of course, the ABC is aiding and abetting them by refusing to discuss the issue.
I have noted this week the saturation coverage the ABC has given to the so called sports rorts affair. Yes, that is a case of seriously bad behaviour by the Government, but it pales into insignificance compared to the pressure put on many Australians in obtaining housing. So why does the primary cause not get more attention.
ABC people, you are not doing your job. Your people have been whining in recent times about freedom of the press in particular having a good old bitch about AFP raids on the ABC offices. Well do not expect any sympathy from me. You are guilty of keeping relevant information from the public. It cuts both ways you know. Keep your bloody ideaology to yourselves, and start reporting/ commenting on ALL relevant facts, not just the bits that suit you.
PS And while you are at it, you might like to comment on the fact that the housing affordability issue is worsened by the fact that many Australians own multiple properties. I believe there are 20,000 Australians who own 6 or more investment properties, including many of our politicians. At one stage Barry O’Sullivan, a Nationals MP, owned 50. What about reporting on whether this is having an effect on housing affordability (or are you frightened the Government might cut your budget if you do). It is clearly a serious question as to whether ownership of residential property in particular should be controlled to ensure that house ownership is shared equitably by all Australians.
Bob Couch
cc Ita Buttrose, Nicolle Flint, Minister of Communications”
"The Affordable Housing Party: the single issue party dedicated to solving Australia's housing affordability crisis. Australians are now living with some of the most unaffordable housing in the world, but it doesn't have to be this way! Obscene tax incentives to invest in property. Our lawmakers profit from the status quo. We opened up our housing market to investors all over the world. Australia's rapid population growth. Home buyers are paying too much to try to compete with investors. This can't go on forever!" Former journalist, Andrew Potts, Sydney, registered the Affordable Housing Party (AHP) with the Australian Electoral Commission earlier this month. Policies include: Phasing out negative gearing and capital gains discount on investment property sales; Stopping overseas buyers from buying Australian properties; Taxing properties left empty by investors; Cutting down immigration to 70,000 annually; Banning full time Airbnb properties; Ending “no fault” evictions for rental properties. Facebook page is https://www.facebook.com/AffordableHousingParty/
The text below is taken from the Affordable Housing Party site at https://www.affordable-housing-party.org/. The new party was also reported in the Murdoch Press at this URL: http://www.news.com.au/finance/money/investing/affordable-housing-party-launches-claiming-renters-and-first-home-buyers-are-being-ignored-by-canberra/news-story/2113945ffb746837789d0af8e12d7818. On the Sustainable Australia Party site at http://www.sustainableaustralia.org.au/120 it describes Andrew as " a former Australian Greens supporter and a former editor of the Sydney Star Observer weekly newspaper."
Australians are now living with some of the most unaffordable housing in the world, but it doesn't have to be this way!
In 1986 in the Inner West Sydney suburb of Dulwich Hill you could buy a newly renovated three bedroom home with a big backyard for $150,000 and pay off the mortgage in under a decade
In 2017 to buy the same home would cost you $1.5 million and you will probably be paying off that mortgage for the rest of your life.
Wages in Australia didn't increase by 1000% in the three decades since 1986. So what happened to make Australia have some of the least affordable housing on the planet?
Obscene tax incentives to invest in property
Negative gearing and the capital gains tax discount on real estate have turned housing from a fundamental human need in Australia into a giant tax minimisation scheme for wealthy Australians.
Negative gearing by property investors reduced personal income tax revenue collection in Australia by $13.2 billion in the year 2010/2011 and that number has only risen each year since then.
Our lawmakers profit from the status quo
Most of Australia's politicians are property investors. In 2016 the 226 members of the Australian Parliament owned 563 properties – a combined property portfolio worth over $300 million.
Put simply, a majority of our politicians have a vested interest in keeping this tax minimisation scheme in place and not intervening in other policy areas that are driving up property prices in Australia because they stand to benefit personally from the current arrangements.
We opened up our housing market to investors all over the world
Another factor driving up house prices is Australia's weak enforcement of its laws governing overseas investors buying property in Australia.
Even just temporary residents are allowed to buy property in Australia and there is no checking that they sell those properties when they leave.
There is also no requirement for real estate agents to check that purchasers are legally entitled to buy in Australia and only a fraction of these illegal sales are later discovered by the Foreign Investment Review Board.
At the same time domestic issues are driving capital flight out of mainland China which has seen many ordinary Chinese people choose Australia as a safe place to park their money in real estate in case the Chinese Government clamps down on their banks.
Many of these buyers do not want the trouble of managing a rental property remotely and do not get tenants in so the property will be in pristine condition when it is sold again. This is not unique to Australia. The same phenomenon has been observed in Vancouver, Hong Kong and other major cities where mainland Chinese investors have bought in large numbers.
A 2015 study of water usage in Victoria by the group Prosper Australia found that there were 82,724 homes in Melbourne that are being left deliberately empty by investors. That's nearly 20 percent of the investor owned homes in Melbourne and it is likely that there are similar numbers of deliberately empty properties in our other capital cities as well.
The 2016 Census suggest that there may be as many as 300,000 of these deliberately vacant investor owned properties across Australia- enough to house every homeless person in this country many times over.
If these properties were made available to renters there would be a significant drop in rents and house prices in Australia.
But as things stand, these unavailable properties create an artificial scarcity of housing for renters and buyers which pushes prices up even higher.
Australia's rapid population growth
Adding to the pressure on housing and infrastructure is record high immigration under the Liberals while they simultaneously demonise refugees - adding up to a quarter of a million new people each year to the country who need to find housing in Australia.
The Affordable Housing Party supports a multicultural Australia and we should never single people out by their race, nationality, culture or religion when it comes to migration into Australia. However the immigration targets that the Australian Government sets need to be at levels that are sustainable in the long term when it comes to the demand for housing, schooling, public transport and other forms of infrastructure.
We fear that Australia's rapid population growth is eroding the laid back quality of lifestyle that attracts migrants to this country in the first place, and we don't want them to be disappointed when they arrive here and discover they will spend most of their lives sitting in traffic jams, struggling to pay off huge mortgages, and probably working until they are 70 before they can retire.
Home buyers are paying too much to try to compete with investors
Fear of missing out and easy lending by the banks has driven more and more desperate people into the housing market, paying more and more ridiculous prices in the belief that property prices will always go up – but they don't and all these things combined are fuelling a dangerous property investment bubble that could send thousands of Australians broke if it finally bursts.
Australian housing is a haven for money laundering by international organised crime groups
For over a decade our federal politicians have failed to subject real estate agents, lawyers, accountants and other associated professionals with roles in the property sector to the Anti-Money Laundering and Counter Terrorism Financing Act 2006 because of push back from industry leaders despite our international partners urging us to close the loopholes.
As a result, Australia remains an attractive place for international crime groups to "wash" their dirty money in our real estate market. This sort of shady economic activity also contributes to the price of housing.
This can't go on forever
All of these factors have combined to form a perfect storm for housing affordability in Australia, but this is not sustainable in the long term.
It is now estimated that property in Australia is probably overvalued by as much as 30 to 40 percent over its real worth. So if you're buying that $1.5 million house in Dulwich Hill it's probably only worth $1 million and you might as well have just burnt your deposit.
However a controlled demolition of house prices in Australia by making property a less attractive investment option compared to other forms of more productive investment over time can prevent an economic disaster from occurring and better policies by government can make sure another bubble does not occur.
Chinese investors are often blamed for Australia’s escalating house prices but a number of factors might mean the demand will drop off in coming years. A recently released report found investment in residential real estate by the Chinese is slowing. As the gap in rental yields between the two countries closes and house prices increase, Australian residential real estate is beginning to look less attractive. The lifting of restrictions on Chinese urban residential property ownership and personal investment monetary restrictions may also play a part. [Article first published on The Conversation, May 1, 2017]
Many Chinese investors have access to both legitimate and hidden income and wealth and seek to invest both in overseas real estate. This is at a time when China is in the grip of its own housing affordability crisis.
Though temporary Australian residents may be required to sell older residential property when they leave Australia, many foreign nationals are able to retain, rent out, sell or live in newly constructed dwellings. This is a major draw card for Chinese investment in new residential buildings.
Other pull factors include Australia’s stable financial institutions, compared to China,, well regulated land title system, buoyant real estate market, high capital gains rates in major cities and lower deposit requirements.
Australia’s Foreign Investment Review Board (FIRB) may keep an eye on these factors when considering new foreign investment in the housing market, but it struggles to counteract the push effect of Chinese property law restrictions and investor needs.
Factors in China at play
Conditions in China’s economy and regulatory environment also push Chinese investors to focus on overseas markets. The depreciation of the Chinese currency is a significant force. As this currency is devalued, Chinese investors reconsider what and where they can afford to purchase.
China has a dual property ownership system that segregates rural and urban land ownership systems. Rural cooperatives own the rural land ownership rights. Cooperative members can only sell to other members of the same rural cooperative.
This limits competition for rural land and keeps rural land prices low. But it also means rural land is an unattractive investment choice for Chinese.
Urban land, on the other hand, remains state owned with a 70 year lease system to housing owners. The system limits ownership of urban residential buildings to people with urban registration or those that have lived in and paid taxes in the same urban area for five consecutive years. This situation stops many Chinese from being able to purchase urban residential property.
Between 2011 and 2015, those who did have the appropriate registration were limited to a maximum purchase of two residential properties within their urban area – one property to live in and one as an investment. This limitation still applies in Beijing.
The limitation was put in place to counteract major housing affordability discontent as an increasing number of people were locked out of the housing market. This problem is exacerbated by the 30% deposit requirement on residential real estate purchases. This combination of factors forces many Chinese investors into purchasing properties on China’s black market where ownership is uncertain or seek investment opportunities outside China.
The Chinese State Administration of Foreign Exchange introduced new regulations to tighten the flow of capital from China in November 2016. This agency is tasked with the approval of outgoing overseas payments of more than US$5 million. However, most housing acquisitions in Australia fall below this limit.
Larger Chinese development companies operating in Australia are known to sell individual residential units “off the plan” directly to Chinese property investors. Where this is the case, the developer has a vested interest in finding ways to circumvent the new limits on foreign currency holding in order to settle a contract. However, it will take time for developers to adjust their methods.
Though rent prices have increased significantly in Melbourne and Sydney, they have not kept pace with house prices. Rental yields have fallen in major cities.
In China, where the rental yield is 1-1.5%, some investors reconsider whether it is worth the effort of renting out their properties. Instead, they rely on the capital gain to create a profit while leaving the property vacant, preventing wear and tear to it. This practice has serious implications for the supply of rental properties in China.
As Australia continues to struggle with escalating house prices and decreasing rental yields, residential real estate investment becomes less attractive as a long term investment for Chinese investors. The reliance on capital gains may result in higher numbers of vacant properties in Australia, counteracting the FIRB’s intentions.
The restrictions enacted by Chinese regulators may slow the flow of money out of China in the short term. However, Chinese investors are likely to find ways to circumvent these restrictions. The lifting of restrictions on Chinese residential property ownership may refocus investment choice location to within China.
"For more than a decade, the Productivity Commission has debunked the common myth that immigration can overcome population ageing. [...] If Australia was truly a ‘clever’ country like Japan, it would manage population ageing by: 1) better utilising existing workers, given there is significant spare capacity in the labour market; and 2) where required resort to technological solutions. The last thing that Australia should be doing is running a mass immigration program which, as noted many times by the PC, cannot provide a long-term solution to ageing, lowers wages, and places increasing strains on infrastructure, housing and the natural environment." This article first published at #comments">https://www.macrobusiness.com.au/2017/06/poor-old-japan-low-unemployment-less-crowded-cheaper-housing/#comments
For more than a decade, the Productivity Commission has debunked the common myth that immigration can overcome population ageing. For example:
PC (2005): “Despite popular thinking to the contrary, immigration policy is also not a feasible countermeasure [to an ageing population]. It affects population numbers more than the age structure”.
PC (2010): “Realistic changes in migration levels also make little difference to the age structure of the population in the future, with any effect being temporary“…
PC (2011): “…substantial increases in the level of net overseas migration would have only modest effects on population ageing and the impacts would be temporary, since immigrants themselves age… It follows that, rather than seeking to mitigate the ageing of the population, policy should seek to influence the potential economic and other impacts”…
PC (2016): “[Immigration] delays rather than eliminates population ageing. In the long term, underlying trends in life expectancy mean that permanent immigrants (as they age) will themselves add to the proportion of the population aged 65 and over”.
In a nutshell, trying to overcome an ageing population through higher immigration is a Ponzi scheme. It requires ever more immigration, with the associated negative impacts on economic and social infrastructure, congestion, housing affordability, and the environment.
The obvious question that follows is, if immigration is not the solution to the ‘problem’ of population ageing, then what is? Enter Japan, whose population is both shrinking and ageing quickly:
And whose labour market is tight, with Japan’s unemployment rate recently hitting a 22-year low of just 2.8% (if only Australia was so lucky!):
Rather than open the immigration spigots for a short-term fix, and in the process crush-load infrastructure and housing, Japan has instead taken the high tech route of engaging in automation.
Population boosters in Australia often label Japan an ‘economic basket case’ due to its ageing population. But the facts do not back this assertion up. In addition to having an unemployment rate that Australian workers could only dream of, as well as a relatively affordable housing market, Japan’s GDP growth in per capita terms has been highly respectable, as it has been for most other nation’s with declining populations:
These facts have not been lost on the Center for Economic and Policy Research (CEPR), which has penned the following rebuke to the clam that Japan is facing a ‘dismal’ future due to population ageing:
The NYT featured yet another piece on a country, in this case Japan, facing a future with a lower population. The piece warns that it will be difficult to maintain economic growth with a declining population and that Japan’s labor shortage would get more severe.
This doesn’t sound like too bad of a story to people familiar with economics. Thus far the labor shortage has not been serious enough to cause wages to rise in Japan. If it eventually does get more severe and wages do rise then it just would mean that some of the least productive jobs would go unfilled. For example, perhaps Tokyo would no longer pay workers to shove people into overcrowded subway cars.
As far as GDP growth, economists usually care about GDP per capita as a measure of living standards, not total GDP. This is why Denmark is a richer country than India, even though India has a much larger GDP…
It is worth reminding readers that growth in productivity swamps the impact of demographics. If Japan can sustain a 1.5 percent pace of productivity growth, then output per worker hour would be 80 percent higher in forty years. Even in a very extreme demographic change, say going from three workers per retiree to 1.8 workers per retiree, this would still allow for a 17 percent rise in average living standards over this period… And this does not account for the benefits from less strain on the infrastructure and the natural environment. Nor does it take account of the lower ratio of dependent children to workers…
Presumably the folks who are concerned about the job-killing robots expect that productivity growth will be considerably more rapid.
We also shouldn’t forget that economists at MIT recently found that there is absolutely no relationship between population ageing and economic decline. To the contrary, population aging seems to have been associated with improvements in GDP per capita, thanks to increased automation:
If anything, countries experiencing more rapid aging have grown more in recent decades… we show that since the early 1990s or 2000s, the periods commonly viewed as the beginning of the adverse effects of aging in much of the advanced world, there is no negative association between aging and lower GDP per capita… on the contrary, the relationship is significantly positive in many specifications.
If Australia was truly a ‘clever’ country like Japan, it would manage population ageing by: 1) better utilising existing workers, given there is significant spare capacity in the labour market; and 2) where required resort to technological solutions.
The last thing that Australia should be doing is running a mass immigration program which, as noted many times by the PC, cannot provide a long-term solution to ageing, lowers wages, and places increasing strains on infrastructure, housing and the natural environment.
A growing number of French people own their own homes. Ownership runs at 64% today, and is expected to grow to 68% in the next six years. France is well behind other European countries though in home ownership. The champions are in Eastern Europe. 96% of people own their own homes in Romania. 70% own their own homes in Italy. Seven out of ten French home owners have entirely paid off their home loan. For people purchasing today, the average time to pay off a home is 17 years. This is a situation to dream of for Australian home-buyers, who are only second to Hong Kong's in suffering under a terrible system. The French system discourages land-speculation in a number of ways which therefore deter the flourishing of a malignant property and growth lobby there. This article is based on a France2 news item "L'achat immobilier, une valeur sure plébiscitée par les Français," 29 January 2016.
Five million people in France own more than one property. 700,000 own more than four properties. Bricks and mortar are the preferred investment - more than the National savings account (le Livret A), bank shares, life insurance or gold.
The most numerous investors are those who rent their homes out for short-term rental, typically via AirB&B or similar. There are regulations to limit this practice to four months maximum a year. Beyond that permits are required by local government. Profits must be declared but abuses are frequent. Hotels criticise these businesses because they compete with them but don't pay the same taxes and are not subject to the same social responsibilities. Careers are evolving in managing multiple sublets of this kind and in servicing them financially.
The Coalition Government today announced that it is taking action to strengthen the integrity of our foreign investment framework.
The Government recognises that foreign capital is vital to help grow our economy and provide jobs. In the case of residential real estate, the current foreign investment regime aims to channel foreign investment into new homes for Australians to purchase or rent.
The Government’s changes will ensure that this aim is fulfilled, and that the current rules that prohibit non-resident foreign investors from purchasing existing homes is enforced.
As the former Chairman of the House Standing Committee on Economics, I am delighted that the Government has accepted all of the Committee’s recommendations.
Today’s announcement includes:
- stronger enforcement of the existing rules by transferring responsibility for foreign investment residential applications from the Foreign Investment Review Board (FIRB) to the Australian Taxation Office (ATO);
- stronger criminal penalties for those who breach the rules – including higher fines and terms of imprisonment;
- new civil penalties to ensure that those who breach the rules do not profit from their illegal purchase;
- new civil and criminal penalties for third parties who knowingly assist a foreign investor to breach the rules;
- application fees to ensure that Australian taxpayers no longer have to fund the cost of administering the framework;
- increased transparency on the levels of foreign investment in Australia through the establishment of a national land register; and
- a modernisation and simplification of the foreign investment framework – the most significant overhaul of the system in 40 years.
The Government also announced that as from Monday 4 May 2015, the ATO will be responsible for the residential real estate functions of the foreign investment framework – including audit, compliance and enforcement activities. This new unit has sophisticated data matching technology that will use existing ATO data, and will match this information against other datasets held by the Department of Border Protection and Immigration, the Australian Transaction Reports and Analysis Centre (AUSTRAC), amongst others.
In addition, the ATO will be issuing letters to individuals and companies suspected to be involved in breaches of the foreign investment framework. It will also conduct investigations of property sales reported to them by the public, along with random audits of properties that have been sold over the past 10 years.
Those in breach of the foreign investment framework will have from today until 30 November 2015 to self-report their breach and be given a longer period of time to divest the illegally purchased property before the new rules come into effect from 1 December 2015. The ATO will pursue breaches against foreign investors who do not voluntarily come forward.
To find out more about today’s announcement click here.
Kelly O'Dwyer, Federal Member for Higgins
Parliamentary Secretary for Federal Treasurer
"Address population growth, tax concessions and foreign buyers." (Sustainable Population Party). The federally registered Sustainable Population Party says Australia’s housing affordability crisis is largely driven by demand-side factors, rather than supply-side issues. The party will take its message to the street at upcoming auctions across Melbourne, including The Block Auction on Sunday October 11.
William Bourke, President of the Sustainable Population Party comments on Australia’s housing affordability crisis, and the activities of the Party to tackle this problem, which included large Melbourne auction visits and a Senate enquiry submission into affordable housing (submission 89). The Population Party submission emphasises that the Australian Government’s policy goal must be to stabilise real estate prices. It argues that:
· Population growth is the primary driver of real estate (land value) inflation.
· Speculative investment has amplified its effect but would not sustain price rises without population growth.
· Investors don’t generate more supply because investors need tenants.
· The entire economy suffers from expensive housing.
In particular, the Sustainable Population Party is calling on the Australian Government to help stabilise house prices through the following measures:
• Reduce population growth in Australia.
• End foreign non-resident purchase of Australian real estate.
• Removing the discounting of capital gains tax on investment properties.
“Sustainable Population Party is redefining growth to secure a prosperous economy, healthy
environment and better quality of life for all Australians. A better quality of life includes more
affordable, well-planned and desirable housing,” said William Bourke, President of the Sustainable
Population Party.
“Australia should achieve greater housing affordability and opportunities for first home buyers and
renters. In particular, the Australian Governments needs to tackle population growth, tax
concessions and foreign buyers in order to bring back the great Australian dream.
It is pleasing to now see John Symond and Paul Sheehan join us in identifying population growth policies as being at the heart of Australia’s housing affordability crisis,” said Mr. Bourke.
The Vietnam War led by the US spanned most of the 1960s through to 1975. The famous motto “All the way with LBJ” developed as a result of Australian PM Harold Holt’s commitment to military support of the US led War in collaboration with Lyndon Baines Johnson, the US President.
The conventional political wisdom at the time was that the North Vietnamese “Commos” were simply part of a larger Communist “Empire” led by Mao Tse Tung; the Chinese Communist revolutionary and founding father of the People's Republic of China, which he governed as Chairman of the Communist Party of China from its establishment in 1949 until his death in 1976.
The War was controversial and based partly on something called the “Domino Theory”, which meant that Australia was exposed to the threat of invasion by the Communist Chinese. Once the Commos took South Vietnam we were done for.
Today Australia faces the irony of an “invasion” by the Capitalist Chinese. Their money is invading Australia.
They are buying houses and farms in order to exploit opportunities for profit, including removal of food from Australia. We have empty houses throughout the suburbs of capital cities that may have been purchased to diversify some foreigner's asset portfolio.
Australia’s politicians, supported by the ABC, provide the Australian people with no reasonable option by way of public policy debate. The ABC just reports what is happening instead of challenging the logic.
It’s all about the wealthiest lobbying for “growth”. People like Paul Keating were praised for “deregulating” the Australian economy in the early 90s and cutting down tariff barriers. The Liberals fully supported these theories.
In 2000, with the Australian Dollar at around 50 US cents, the import duty on foreign cars was around 5%. By 2008 the Australian dollar had risen to around 95 US cents. Similar rises had also occurred against all major currencies. In order to maintain the competitiveness of the Australian car industry at a level comparable to year 2000, the tariff would have needed to rise to 78%, because US Dollar priced cars had become so much more competitive.
This was free trade (?) combined with a rigid tariff structure that ignored the integral part that the exchange rate played in defining competitiveness. What drove the Australian dollar so high? Surely this was a combination of factors driven by Government policies including:
Extreme population growth driven by mass migration
The population policy driving demand for everything, including housing
The population policy creating a dilemma for the Reserve Bank’s interest rate policy. There is a conflict between the need to use high interest rates to resist house price inflation and the need to reduce Australia’s exchange rate using low interest rates. The Government and Reserve Bank have failed miserably in achieving a coherent outcome. Some of the blame must surely be attributable to the extreme population growth policy
The FIRB’s failure to manage the impact of foreign investment on the long term "interests" of the Australian people by supporting foreign investment in all its forms
The delusionary thinking that convinces both economists and politicians that GDP growth must be driven by population growth despite all the KPI’s that suggest that this may not be true. These include adverse trends in unemployment, homelessness, productivity, infrastructure funding, Federal budget growth, GDP growth per capita, and environmental impact. In fact there is arguably not a single KPI that clearly supports extreme population growth
So what is driving extreme population growth? It’s really quite simple. Politicians are addicted to dumb GDP growth and fail to perform the due diligence analysis of the facts that might lead to a better understanding of the extreme population growth problem in Australia.
The ABC fully supports this failure by claiming the issue is “not newsworthy”.
Big business loves it because it drives short term profits. No other criterion is substantially or actively used to drive the decision-making of big business.
If the Government can neither evaluate nor comprehend what is in the national interest; what hope is there for Australia's future?
Originally published in Miscellaneous Comments. - Ed
The Age reveals that first home buyers made up a record low 12.2 per cent of new housing loan commitments in Victoria in September, a sharp fall from the peak of 31.6 per cent in May 2009.
"I can see the difficulties for young and first home buyers of getting into the market," said shadow treasurer Chris Bowen, who labelled the affordability crisis a serious national issue.
It's interesting that we now have a Shadow Treasurer, the previous minister for Immigration under Labor, commenting on the blowout of the housing bubble, who is seeing the evidence of high rates of immigration - and loose borders that allow foreign investors to strangle the real estate market.
Economist Saul Eslake, a member of the National Housing Supply Council, said vested interests from property owners and politicians meant policies that could support first home buyers - such as the abolishment of negative gearing and lower costs for new developments - were unlikely to ever see the light of day. The housing Ponzi scheme is being driven and manipulated by investors, who create and guarantee their portfolios delivered by high rates of population growth and heavy support for domestic and foreign investors.
All Ponzi schemes eventually collapse. Back in February 2012, Deakin University’s Philip Soos said that the only thing that prevented Australian house prices from crashing during the 2008 GFC was the first-home owners’ boost, who believes the sector is now operating like a Ponzi scheme. According to Soos, the tipping point for the mark will come when “the household sector is so overloaded with debt there exist no more ‘greater fools’ willing to commit to a lifetime of debt serfdom to purchase property”.
Sooner or later you run out of unsuspecting new investors and the whole thing collapses.
The end of the housing bubble will hurt our economy, but it's time to make the transition to a real and productive economy, rather than the predatory one of mortgages, accumulating more and more potential buyers (victims) into the scheme, and the strangle-hold property developers.
Paul Cleary’s book Too Much Luck: The Mining Boom and Australia’s Future, is a timely appraisal of the dramatic economic and social impacts, as well as the political ramifications of the current resource boom.
(The reviewed work covers much of the same ground as Dirty Money of 2011 by Matthew Benns, which I am currently reading and can also recommend.) This review of Paul Cleary's book by Professor Kerry Carrington, Head of School of Justice at Queensland University of Technology was originally published on theconversation.edu.au on 25 November. It is being reprinted here with her kind permission. Professor Carrington asked that this review be republished as widely as possible.
Paul Cleary’s book Too Much Luck: The Mining Boom and Australia’s Future, is a timely appraisal of the dramatic economic and social impacts, as well as the political ramifications of the current resource boom.
Cleary argues that the resource investment stampede is squandering Australia’s precious non-renewable fossil fuels, leading to a high dollar, inflation and interest rates, at the expense of manufacturing, education and tourism industries.
There is, he argues, a strong case for a more measured approach to harvesting these resources in the long-term interests of all Australians through better taxation, saving and regulation of the resource sector. This book is not anti-mining and does not argue that resources should be left in the ground, as Stephen Kirchner would have us believe.
Cleary coins the phrase “investment stampede” to capture the seismic shifts at work. The sector is growing fast – too fast – at 15% per annum, with a pipeline investment of $174 billion. Global demand especially from Asia has fuelled this boom. Current economic returns for the mining corporations and their shareholders are staggering.
Cleary coins the phrase “investment stampede” to capture the seismic shifts at work. The sector is growing fast – too fast – at 15% per annum, with a pipeline investment of $174 billion. Global demand especially from Asia has fuelled this boom. Current economic returns for the mining corporations and their shareholders are staggering.
In August 2011 BHP announced an annual net profit of $23.5 billion, while earlier in the year Rio Tinto had announced an annual profit of $14.3 billion.
Cleary’s book analyses an array of adverse impacts resulting from an investment stampede, including the growth of fly-in, fly-out (FIFO) workforces. Until the 1970s, mining leases tended to be issued by governments subject to conditions that companies build or substantially finance local community infrastructure, including housing, streets, transport, schools, hospitals and recreation facilities. Townships and communities went hand in hand with mining development.
Not any more. The haste of this extraction process has become increasingly reliant on a continuous production cycle of 12-hour shifts, seven days a week, and one increasingly reliant on fly-in, fly-out or drive-in, drive-out (non-resident) workers who typically work block rosters, and reside in work camps adjacent to existing rural communities.
There are estimated to be around 150,000 non-resident workers directly employed by the resources sector, anticipated to rise to around 200,000 by 2015, but no government body appears to be counting and projected growth is equally elusive.
This is an odd oversight given the rapid growth of reliance on non-resident workers in the resources sector carries significant impacts for individual workers and their families and host communities, as evidenced by the many submissions to the Australian Parliament House inquiry into FIFO/DIDO work practices, chaired by the Independent MP Tony Windsor. Some of the significant impacts include:
A sudden influx in high risk populations (young single males with large disposable incomes) exacerbating crime and alcohol-related social disorder problems
The creation of new lucrative unregulated drug markets and markets in commercial sex work.
Rises in traffic congestion and road accidents.
Stretch on infrastructure.
The erosion of community wellbeing.
Heightened risk of protracted social protest over coal-seam gas extraction.
Ongoing widespread social protest against the erection of camps in close proximity to established rural communities.
Increasing burden on local services.
Soaring housing costs and other local costs of living
“Fly over effects” on the local economy, and an ever-decreasing permanent resident workforce
Increasing rates of staff turnover,
Reversal of the trend of women entering the mining industry (down from 15.7 to 12.6% according to the most recent ABS statistics)
Increases in the average hours worked each week exacerbating fatigue related car accidents and work injury as they commute either end of work cycles than in the workplace (an average of hours 45 hours as at August 2011, with 1 in 3 working over 60 hours per week).
These impacts undermine the long-term sustainable community development of rural Australia. It is troubling therefore that dramatic socio-demographic processes have been unleashed by this boom without concerted attempts to accurately research, measure or account for the numbers of non-resident workers involved and their nation-changing impact on the Australian society and economy.
Just as the number of non-resident workers is not being researched or counted, Cleary draws our attention to how the rapid depletion of natural non-renewable resources is not being counted either. Again, the long term social and environmental costs, including the time value of Australia’s natural resources and the opportunity costs of squandering them through an investment stampede are not being measured.
Instead, the gaze of most state politicians in particular has been transfixed on the short-term economic benefits shared by so few. Cleary draws attention to the dominance of a short-term economic view which frames the current resources boom – a view to which Kirchner appears wedded.
The real challenge for a government of and for the people – and not just a government at the beck and call and in the pocket of the powerful mining industry lobby – is to recalibrate the frame of reference for assessing and responding to the social and ecological impacts of the mining boom in the long term interests of the nation.
The corporate power of the mining industry, especially to lobby governments, state and commonwealth to influence policy making in Australia is alarming. As Cleary points out, “Not only did the miners change the prime minister and change government policy, they went on to brag about how their coup had stopped similar schemes from spreading around the world.”
State governments who grant mining licenses and regulate the industry also earn a share of the minerals extracted through royalties. Last year Queensland and Western Australian governments collected around $6 billion.
The Queensland government’s endorsement of the BHP Billiton Mitsubishi Alliance proposal at Moranbah to allow up 100% of workers to be non-resident is a more recent example of Cleary’s complaint about the impact of corporate power. It even contradicts Queensland’s own resource sector housing policy that workers should be allowed the choice where the live and work industry. The Moranbah mining community, with its long history of communal solidarity, is now destined to become surrounded by thousands of non-resident workers housed in dongas.
While the Queensland government introduced social impact assessment processes as part of the Environmental Impact Assessment approval process in Sept 2010 in part to address these concerns, it has failed to regulate the long term cumulative impacts of resource development. Why? State governments have a fundamental conflict of interest in setting themselves up as the arbiters in disputes over access to agricultural land, the granters of exploration licenses and the approvers of environmental and social impact statements, precursors to project development consent from which royalty payment to the state flow
Cleary’s book offers a much needed critique of the collision of self-interest between state governments and mining companies which both profit handsomely from the speedy extraction of resources.
Given the state governments’ conflict of interest and susceptibility to being courted by corporate power, the need for a commonwealth power to over-ride state powers in the interests of the more effective long-term regulation of the mining industry is long overdue. This week, Australia got one thanks the insistence of independent MPs Tony Windsor and Rob Oakeshott, who supported the Mineral Resources Rent Tax (MRRT) in return for the overhaul of the environmental approval processes and legislation.
Given the state governments’ conflict of interest and susceptibility to being courted by corporate power, the need for a commonwealth power to over-ride state powers in the interests of the more effective long-term regulation of the mining industry is long overdue. This week, Australia got one thanks the insistence of independent MPs Tony Windsor and Rob Oakeshott, who supported the Mineral Resources Rent Tax (MRRT) in return for the overhaul of the environmental approval processes and legislation.
Too Much Luck can be credited for fanning the shift in public opinion and political climate in support of the MRRT. We are at a critical moment in the boom, when strong, not weak, Australian Government leadership through the policy-making processes of federalism are absolutely vital, if, to use one of Cleary’s metaphors, Australia is not to look like Nauru, “but on a continental scale”.
The Salvation Army has joined a growing list of faith-based community aid organisations that have jumped onto the urban development bandwagon at measurable expense to wider community interest. The Salvos have lodged an urban subdivision proposal upon a heritage site in the Brisbane suburb of Chelmer. An approval will result in demolition of the site's buildings and sale of the re-zoned land.
Maybe it's time for such entities to re-examine their strategic objectives.
Should they be attacking the root of the problems they ostensibly deal with, or is it OK to actively assist expansion of the disadvantage market?
Are they primarily a charity or are they an economic corporation focused on growth?
An impact assessable subdivision application has been submitted for this site by the Salvation Army which includes demolition of existing buildings. A003019156
Warrina Village is an aged care facility at Chelmer owned and man-aged by the Salvation Army. The Salvation Army propose to relocate the facility to Chapel Hill and dispose of the site.
The site includes a 19th century two storey residence, originally known as Pontresina. Pontresina has cultural heritage values as a substantial 19th century villa and is entered on the City Plan Heritage Register.
The Salvation Army propose to demolish most buildings on the site and re-configure the lot (Lot 4 on RP 163091).
A SENIOR Treasury official has sounded the alarm over Australia's property market.
He has warned that the prospect of a sudden and dramatic drop in prices is "the elephant in the room" and should not be ignored by the federal government.
[Source: Treasury warning on home price bubble by Sean Parnell, FOI editor, The Australian, 20th November 2010]
While the government and Reserve Bank insist Australia does not have a housing bubble - as some economists and the International Monetary Fund suggest - it remains such a worrying concept that Treasury has privately sought reassurance from its analysts that prices are not artificially high and that Australia does not face the kind of house price collapse that has hit Britain and the US.
Documents obtained by The Weekend Australian under Freedom of Information laws show the Treasury officials preparing the so-called Red Book of briefs for the incoming government were as divided as private sector economists about the strength of the property market.
Phil Garton, the manager of Treasury's Macro Financial Linkages Unit, sent colleagues a draft paper on the rise in household debt, prospects for further growth in the debt-to-income ratio and the potential implications of slower household debt growth.
His email prompted an exchange with Steve Morling, currently the general manager of the Domestic Economy Division, who argued the paper should "make a bit more about the risks".
"The elephant in the room is house prices or more specifically the risk of a precipitous drop in them, perhaps from an external shock or perhaps from their own internal dynamics when affordability constraints or capacity debt levels see prices and expectations of house prices start to move in the opposite direction," Mr Morling wrote on June 15.
"(I) know there are very supportive fundamentals, but prices rose by 50-60 per cent in three to four years in the early part of this decade, with largely unchanged fundamentals, so they can have a life of their own.
"And given what's happened elsewhere I'm far less sanguine about this - and the interplay with debt - than in the past."
Mr Garton agreed that there would be risks if the fundamentals of low interest rates, unemployment, and financial deregulation "reversed significantly". But he maintained the price growth in the early 2000s was based on a "lagged response" to improvements in the fundamentals, and questioned how Australia could have maintained a bubble for more than six years.
Rudd's penchant for a 'big Australia' is behind his absurd record immigration policy. Population growth and congestion is out of control and is the common denominator driving up Australian land prices, electricity, water, inflation, consumer demand, interest rates, and consequently the costs of living of ordinary Australians.
Our state and federal public infrastructure cannot cope - roads, public transport, health, education, housing, you name it!
Our state and federal public infrastructure cannot cope.
The cost of living for ordinary Australians is becoming desperate!
BIGGER ELECTRICITY BILLS
Today, Origin Energy chief executive, Grant King, warned the Committee for the Economic Development of Australia in Sydney that Electricity prices across Australia were likely to triple over the next 10 years.
He blamed the combination of the federal government's mandatory renewable-energy targets, energy policy uncertainty, higher electricity transmission and distribution costs, and higher fuel costs would drive the increase.
King attributed the rise in electricity demand to booming sales in energy-inefficient flat-screen televisions and air-conditioners. ['Energy prices to triple', The Australian April 14, 2010] This is clearly a consequence of new housing development driven by population growth laregley fueld by record immigration. And the growth lobby like the Urban Taskforce are lapping up the new cash!
Last month, that dodgy NSW Government euphemism 'The Independent Pricing and Regulatory Tribunal (IPART)' approved electricity price rises of up to 64% over the next three years, with "those living outside the main cities will bear the brunt of the increases."
'Country Energy, which provides all of rural NSW customers with their electricity, has been allowed to raise its prices by the steepest amount, with an increase of $918 if the scheme is introduced; otherwise, the rise will be $601.
'Overall, Energy Australia customers will see prices rise by a total of 46 per cent, for Integral Energy 60 per cent, and for Country Energy 64 per cent.
Welfare groups have warned that the price rises will force many low-income households into ''energy poverty'', and they will not be able to afford to pay their bills.'
[Brisbane Courier Mail, 'Households to feel pinch as price of power soars', 19th March 2010]
BIGGER WATER RATES
Across Australia, water rates are on the rise as each capital city spends big on desalination plants to cope with their swelling populations.
Last April (2009) it was reported by the Essential Services Commission that Melbourne households faced water price hikes of up to 84% over five years. The key drivers were claimed to be the global economy (standard excuse) as well as government not keeping water infrastructure up to demand and so deferring infrastructure works for years. [The Age (Melb), 21 Apr 2009]
Just two days ago, (12th April 2010), with Melbourne's extravagant new desal plant blowing out to cost a whopping $5.7 billion, Melbourne's water prices will further escalate to pay the bill and because of the extravagant dependency of desalination for electricity, which is also going up in price.
'Over the past five years the price of electricity has increased 13 per cent a year in Victoria - and in NSW prices have risen 28 per cent a year in each of the past two years.'
['Water plans drift behind a veil of secrecy', The Age April 12, 2010]
BIGGER HOUSING PRICES
In 2009 Australian capital city house prices rose by 12.1%. Meanwhile Australia's homeless stands at 16,000. Key drivers for house prices surging are the government’s first-home owners’ grant boost.
['Web alert - warning on 'crazy' house prices', Sydney Morning Herald, 16th February 2010]
Other drivers are the inflow of new immigrants seeking accommodation and foreign nationals permitted to invest in Australia's residential housing market.
BIGGER MORTAGE INTEREST RATES
Last December, interest rates were predicted to rise 1% during 2010. But the drivers were the surge of capital projects in the next few years and China growth.
['Business, brace for 1% rise in interest rates in 2010', Sydney Moring Herald, 24th December 2009]
This month, all the banks followed the Reserve Bank in raising their mortgage rates by 25 basis points, making this the 5th interest rate rise since October and has pushed up mortgage costs by a total of almost $250 a month.
Treasurer Swan said the rise was “a painful reminder” the economy was improving. How out of touch is Swan?
Economists warned there could be at least one more rate rise before the end of the year.
['CBA, ANZ, Westpac follow as Reserve Bank raises official cash rate to 4.25%', Herald Sun , 6th April 2010]
BIGGER GROCERIES BILLS
It was confirmed just last November that Australians "are paying the fastest-rising food prices of any major developed nation. The cost of feeding a family has shot up more than 40 per cent this decade, new OECD figures reveal.
Experts say the explanation for our pricey produce and soaring staples is not drought, currency movements or transport costs. University of NSW associate professor Frank Zumbo said comparing costs over 10 years eliminated such variables and exposed our "cosy" supermarket duopoly as the main reason.
[Daily Telegraph, 'Australia has fastest-rising food prices of any major developed nation', 9th November 2009]
BIGGER MEAT PRICES
Wholesale butcher Kevin Masterton says the days of expensive cuts at cheap prices are over for Australian meat lovers. He's predicted Australian meat prices will never be the same again.
"Everyone is predicting Lamb will be the first Australian meat that is unaffordable. Some of the predictions I've seen is that lamb racks and cutlets will be one hundred dollars a kilo by the middle of this decade," Kevin said.
And it's all because we've been spoiled for choice. The drought has forced farmers' hands - they've had to off-load cattle to stay afloat. "They see that they are going to make more money on the cattle so they hold onto them for longer. There is also quite a bit of export, the economy has started to turn so there is less cattle in the market," Kevin said.
And it's a similar story when it comes to lamb. There's been a nine per cent jump in retail sales and a 10 per cent rise in national expenditure on the meat.
And this year the nation's sheep flock is forecast to hit its lowest point since 1905. "And we have got massive exports to the middle east, so if you take those factors into account they've had a pretty detrimental impact on the stock," Kevin said.
"Lamb has probably had the most spectacular increase - we are probably talking four to five dollars a kilo for the lamb cuts."
['Meat prices on the rise', Today Tonight, 3rd March 2010]
So there is not enough capacity in our meat livestock industry to cope with demand, hence meat prices are going up.
BIGGER PETROL COSTS
"Crude oil prices have surged to 18-month highs on the weekend and have swept petrol prices higher.
Oil prices could go to $US95 a barrel, warns analysts. Domestically, a litre of unleaded petrol costs $1.29, up 0.3 cents.
'Oil, which has been trading at between $US75 and $US85 a barrel for months, now appears to be in a new range that could go up to $95, according to oil trader and analyst Stephen Schork.'
[Perth Sunday Times, 'Petrol prices set to rise, 6th April, 2010]
The trend suggests that Australian petrol prices could be nudging $2 a litre in two years time and this time it will stay there in line with international prices. Ain't globalisation and free trade great for locals!
BIGGER POORER AUSTRALIA
The compounding cost of living for ordinary Australians is becoming desperate!
What the economic data doesn't report is the social consequences - like the growing depression, family breakdowns, homelessness, substance abuse, suicides and domestic violence.
The long term impacts on children are devastating for not only the children but the future society they become adults in.
More people into less space driving up living costs, only delivers a poorer Australia.
The drivers of these costs must be addressed as a national priority.
The BIG elephant in the room is starkly Rudd's immigration out of control!
Rudd's red herring Population Minister is just that, an election red herring.
Rampant Rudd and his immigration wrath must be stopped!
The National Human Rights Consultation is seeking views about human rights in Australia on the following:
1. Which human rights and responsibilities should be protected and promoted?
2. Are these human rights currently sufficiently protected and promoted?
3. How could Australia better protect and promote human rights?
You can send a written submission via the submissions page or send it by mail or register to attend a community roundtable discussion in your state. The Consultation will run from 10 December 2008 until August 2009. The last date submissions can be accepted is 15 June 2009. After listening to the views and ideas of the Australian people, the Consultation Committee has been asked to report to Government on what they have heard by 31 August 2009.
Below is an excellent submission, by Sally Richardson, which I found on the site for public submissions:
Which human rights and responsibilities should be protected and promoted?
Housing is a fundamental human right. Through the United Nations International Covenant on Economic, Social and Cultural Rights, Australia has made a commitment with other Nations of the world to work towards ensuring adequate housing for its citizens.
Article 11 of the Covenant begins:
The States Par ties to the present Covenant recognise the right of everyone to an adequate standard of living…including adequate food, clothing and housing and the continuous improvement of living conditions…
The intent of this Covenant is further explained through detailed Comments, which state:
The right to housing should not be interpreted in a narrower, restrictive sense which equates it with, for example, the shelter provided by merely having a roof over ones head ...rather it should be seen as the right to live somewhere in security peace and dignity.
Adequate housing is defined to compromise security of tenure, availability of services, affordability, habitability, accessibility, location and cultural adequacy.
Are human rights sufficiently protected and promoted?
No, in relation to housing and homelessness, human rights are not sufficiently protected and promoted in Australia.
Australia is experiencing a growing housing crisis. Australia is a signatory to the International Covenant on Economic, Social and Cultural Rights. Yet in 2009 there are an increasing number of homeless people, less adequate housing available and a small safety net. There are limited options for people experiencing homeless and this is an area of concern for Australia.
Some of the issues arising in housing are:
Private Rental Market
Rents have sharply risen in the private rental market causing housing stress and a lack of available affordable rental properties. In Queensland the private rental market continues to offer a relatively low security of tenure and provide for without ground eviction of households. There is currently no maximum threshold on rent increases legislated in the Residential Tenancies Act 1994; the Lessor can increase rent above median prices. According to the Residential Tenancies Authority the median rent for a 4 bedroom property in the Inner Southern Suburbs Brisbane in the March quarter 2004 was $290 per week. On March10th 2009 properties advertised on real-estate.com 4 bedroom properties in the Inner Sothern Suburbs range from $650 to $1400.
Levels of income for Centrelink and rent assistance are low, private market rents are not affordable for people on these payments. Housing needs to be acknowledged as a human right and affordable housing made available for people on low incomes.
Home Ownership
It is becoming increasingly difficult to buy your own home, due to inflated house prices across Australia. In the current financial climate these difficulties are on the increase, with people from all backgrounds experiencing unemployment and financial stress.
Public Housing
In Public and Social Housing there is a limited supply of housing with people waiting for many years to obtain Public Housing with no guarantee of being placed in housing. Currently, in Queensland there has been a shift to the One Social Housing system, this new system is needs based, focusing on priority housing and merges Public and Social Housing. A focus on priority and needs based assessments is disempowering and rigid for people in the system. People are required to draw out all their difficulties and hardships to get housed in a priority based system, yet there is no guarantee for people to be housed. This system based on priority and needs compromises people’s dignity. The system needs to shift to a human rights based assessment. This shift to a priority housing system reflects a housing assistance program that has given up on housing the majority of people and focusing on the people in the most need. This indicates we cannot meet our obligations to provide all people with the right to housing.
Emergency Housing
Emergency accommodation is limited and short term for people experiencing homelessness in Australia. Often emergency accommodation is not suitable or available for people with children or people with disabilities.
Homeless People and Public Space
In a climate of increasing homelessness there are many people sleeping rough in public spaces. Currently, there is a lack of awareness and understanding around the visibility of homelessness in public spaces. In July 2006, the Police Powers and Responsibilities Act 2000(Qld) was amended to make move on powers available to police in all public places in Queensland (s.44). These laws affect homeless people negatively using public spaces. As people can be moved on to another place for 24 hours for making people anxious, disrupting an event, offending or threatening people, interfering with trade or business or being in a prescribed place.
These powers effectively move the problem of homelessness to another place and targets homeless people. Australia needs to ensure that homeless people are protected from discrimination and move on powers. In establishing a Bill of Human Rights in Australia there is need to acknowledge and understand that homeless people do co-exist in public space and that this space is their home until they are able to secure housing.
How could Australia better protect and promote human rights?
Australia could better protect human rights by creating a National Charter of Human Rights. This Charter should clarify rights of people experiencing homelessness and highlight the responsibility of the community to protect citizens experiencing homelessness from the discrimination of move on powers and clarify that people have a right to access public space.
Create a National Bill of Human Rights that is actively monitored similar to the UN Convention on Human Rights and legislate around this for an increased level of protection. This can identify gaps and work on solutions to housing in Australia.
Actively work towards a flexible system that ensures all people can access appropriate housing and people are not locked in a cycle of homelessness because of rigid, inflexible systems. Ensure the system is empowering and supportive for people in need and does not further disempower people experiencing hardship. This involves shift towards a human rights based system for the Department of Housing to house all Australians in need.
Promote a human rights culture and discourse in Australia with all citizens. Encourage ideas and how this human rights discourse can be implemented to ensure all Australians have access to affordable, appropriate housing.
The letter below appeared in Brisbane's Courier Mail of Saturday 18 October.
As the rental crisis continues to push people and families into more difficult circumstances, I am not hearing any debate or talk about implementing a system in Australia similar to that in Europe to provide people on average incomes with long-term rental accommodation security.
I have friends in Europe who have rented their abodes for more than 10 years. They can plan ahead and raise their children knowing they will be able to go to the same school, have the same friends and live in the same neighbourhood.
This stability contributes to balanced, successful, adults and better communities in the longer term.
In Australia, we are subjected to six or twelve-monthly leases, two weeks' notice (without grounds, under a fixed term agreement), indeterminable increases each time a lease ends and lack of affordable and quality property.
There are many decent people who rent, yet we are treated as second-class citizens who can't be trusted; and children are raised in these environments.
I am an employed professional. I work part-time and raise a child on my own. Our rent recently increased by almost $100 a week (last year the increase was $50 a week). We have two weeks to decide what to do. Surely, as a society, we can do better than this.
The article "Baby Boomers Hog Housing Market" on ABC News and quoted on ABC local radio 15.8.08 runs the serious risk of engendering intergenerational resentment. In the report, "Baby Boomers" (people born between 1945 and 1960) are bagged for using the equity in their first homes to buy subsequent investment properties, thus driving up the cost of housing and depriving later generations of being able to afford a roof over their heads.
The article is sparked by information reported by the Financial Services Institute of Australasia.
It seems the blame for declining housing affordability is being laid on a whole generation (easily identifiable by their appearance as most of them are in their 50s) whereas one would be more justified in laying the blame on those who have successfully lobbied governments for very high population growth - mainly through immigration.
It is well accepted that high immigration and housing construction lagging behind the added demand that comes from immigration, is the main reason for declining housing affordability. Real estate pundits and governments admit this readily. Who would plunge themselves into debt to purchase an investment residential property and deal with the hassle of maintenance and tenants, if one did not think it would be financially worth while? The prices were already rising because there are more people needing them ! Far easier to buy some easily liquidated shares and not have the hassle!
"Working families" in their fifties who have 2 or 3 mortgaged investment properties are, as I would see it, defensively taking the crumbs they can afford in order to fund their retirement and to bequeath something to their children.
It is quite possible that many of those who lobby for population growth are in the "baby boomer" category. To blame, however, all the ordinary people in that age bracket who need to invest wisely for their retirement, not to mention those many baby-boomers without homes or superannuation, is to blame the victims. They are certainly not the main beneficiaries of rising property prices.
Coincidentally there are reported serious concerns that many people of this BB generation will have insufficient means to fund their winter years.
An article also on ABC News 4.8.08 by business editor Peter Ryan and headed "Survey reveals baby-boomers' retirement cash fears," makes one wish that more of them were able to provide adequately for themselves. Seems they are damned if they do and damned if they don't!
The August 15th article is mischievous and its conclusion is spurious. It concludes that one generation is to blame for the fact that declining housing affordability affects those who don't yet own a house and who are generally in a younger age group.
This is simplistic and sensationalist.
If the blame was laid at the feet of a particular religion or ethnic group, rather than an identifyable age group, there would be outrage and complaints to the Human Rights and Equal Opportunities Commission.
- Government needs to take a role in buying and developing land into mixed use communities, particularly around existing railway stations. The development can be built by the private sector but should remain in government ownership and provide housing and jobs for a diverse range of socio-economic groups.
- Individual house lots should have much smaller yards but each community should provide more public open space with tennis and basketball courts, walking trails, cricket nets, a pool, community gardens and outdoor performance areas. This reduces duplication between households.
- New communities should also have a community centre with a library, computers, meeting rooms and entertainment rooms to again reduce the need for private space within each household and reduce the need for everyone to own the same things.
- Rather than each house having a garage communal parking facilities should be provided, and small vehicles such as golf buggies can be used if people need to drive to their property. Again this would reduce the cost of a house by more than $5,000 because there is no need to build a garage.
- Some parts of a new development should also offer shared kitchen, laundry and other facilities to reduce living costs for each individual household.
- Each development should have a car sharing scheme in place and a small fleet of car share vehicles to reduce the need for each household to have their own car. Obviously developments should be serviced with quality public transport from the outset.
The more we can share the less we need to do unnecessary work.
Brisbane's Courier Mail of Thursday 31 July reported that house values had dropped by 1.3% in the June quarter whilst the value of units had dropped by 3% over the same period.
As this fall has been largely brought on by higher interest rates and the lack of consumer confidence it is unlikely to provide any practical relief to ordinary Brisbanites who have seen housing prices rocket completely beyond their reach in recent years.
True to form the Courier Mail, an ardent promoter of the property 'industry', reported this threatened momentary pause in the upward movement of the cost of a basic human necessity as bad news:
Nationally, the market was at its weakest in four years.
...
He expects values will drop 10 per cent over the year, cutting almost $44,000 in value from the average priced home.
He said high borrowing rates, finance being harder to get and a big drop in consumer confidence were hitting hard.
And Mr McNamara warned that if banks continued to increase mortgage rates and the Reserve Bank lifted cash rates then price drops would be even more severe.
However, Mr MacNamara's pessimism was not shared by RPdata residential research director Tim Lawless, who predicted that Brisbane will have a 'softer landing'.
"Ten per cent sounds a bit pessimistic to me and ignores the strong population growth (my emphasis) and limited supply#main-fn2">2 in Brisbane," Mr Lawless said.
He predicted price declines will be forgotten by this time next year with prices increasing late in the year and early in 2009.
Notwithstanding this Mr MacNamara maintained that strong migration patterns were not enough to attract either first home buyers or investors.
In other parts of Australia, the effects of the credit shortages and lack of consumer confidence have, so far, manifested themselves differently. The Sydney Morning Herald of reported that house prices had slumped by 2% in the past year whilst the ABC on 24 July reported that Perth rental prices have risen 17 per cent, while rents for units have increased 25 per cent. The Canberra Times of 25 July reported that "median weekly asking rents for houses and units up by 5 and 10 per cent respectively in the past year."
Whether Michael MacNamara or Tim Lawless are correct in their predictions of the property market, this story further confirms what critics of immigration have been arguing for years. The principle motivation behind immigration is not as a charitable act towards other people or even to serve any vital economic need, rather, it is nothing more than a crude device to drive up the demand for housing to facilitate the transfer of wealth from the broader Australian community and from other countries into the pockets of land speculators and property developers and related industries such as financial institutions and manufacturers of building products#main-fn3">3.
#CourierMailCensorship" id="CourierMailCensorship">Postscript: Censorship by Courier Mail?
On Saturday 2 August, I posted a comment to the comments section attached to the abovementioned story in the Courier Mail and it has not, as of now, been published. As I did not keep a copy, I will reproduce it from memory as best as I can:
I agree with Lionel Theunissen of Brisbane (Comment 87 of 103)
Why does the Courier Mail always regard it as good when the price of house go up and bad when the price of houses go down?
As one for whom the cost of housing has gone completely out of my reach, I find it personally offensive when others rejoice in the price of housing going up.
Lionel Theunissen's comment referred to above follows:
Great news, but house prices in Brisbane could halve and they still wouldn't be cheap.
A 10 per cent drop is just the beginning. With the tightening of credit property will return to its intrinsic value, where potential rent can pay the interest on a 100 per cent mortgage. That means a property that might rent for 400 dollars a week is worth around 220,000 dollars, with prevailing interest rates at 9.5 per cent, not the 440,000 or so that might have been the market value up until recently.
For those saying "demand is still high, supply is low" in the hopes that somehow we will avoid the global trend, that is a naive, at best, interpretation of the laws of supply and demand: All demand can do is push buyers willingness to pay towards their capacity to pay, which is directly linked to their capacity to borrow. Willingness to pay has been maxed out for some time. With the tightening of credit and increases in interest rates the capacity to borrow has been greatly reduced and the market must come down to meet this.
The days of easy credit will not be returning any time soon, and the property market will not show any significant recovery until it does. The party is over folks!
My comment upon further reflection: Lionel Theunissen may not be taking into account the factor of high immigration referred to in the article above. Whether or not immigration will fulfil all the hopes of property speculators, if not dramatically reduced, will certainly serve to keep housing prices beyond the reach of most of us.
Footnotes
#main-fn1" id="main-fn1">1.#main-fn1-txt">↑ Whilst, we at candobetter.org do not have a high regard for the property sector, we believer that credit should be given to those who, in a manner out of character with most in the industry, demonstrate compassion and decency. This appears to be the case recently with Michael McNamara. In Don't abuse rates excuse, landlords told of 25 July 2008, Sydney Morning Herald Sunanda Creagh Urban Affairs Reporter reported:
AS MANY as half of all landlords have paid off their mortgages and should not be using interest rates as an excuse to push up rents, one of Sydney's top property analysts says.
Michael McNamara, the general manager of Australian Property Monitors, said the principle of supply and demand influenced rents more than interest rates did.
"Let's face it: investors have a profit motive in mind and they don't necessarily need a reason like interest rates to put up rents.
They do so because they can," he said. "The question becomes: are they simply trying to achieve market rents or are they profiteering from the current shortage of housing?"
#main-fn2" id="main-fn2">2.#main-fn2-txt">↑ This does raise the measures now being demanded by property developers as the 'solution' to housing unaffordability, that is, for more land to be released for subdivision. Whilst this measure could serve to partially negate the inflationary effet of furhter high immigration, it would be at a cost to the environment, food security and our quality of life that many consider unacceptable. For further discussion of this, see my article Brisbane's housing unaffordability crisis spun by ABC to promote property lobby interests of 23 June 2008.
#main-fn3" id="main-fn3">3.#main-fn3-txt">↑ This phenomenon was the subject of the 2002 Masters' thesis The Growth Lobby and its Absence : The Relationship between the Property Development and Housing Industries and Immigration Policy in Australia and Franceby population sociologist Sheila Newman It is available as a single 2.5MB PDF file here or as at Swinburne University.
Almost invariably reporting of Australia's acute housing unaffordability crisis does not inform the public of its causes, nor help it to arrive at a solution. The ABC's report No relief in sight for Brisbane's renters of 20 June 08 is no exception.
Yet another article, this time on the ABC's online news service, No relief in sight for Brisbane's renters of 20 June 08 provides yet further confirmation that the polices promoting rapid population growth by all levels of government in Brisbane - local, state and federal - are recklessly harmful to many of Brisbane's existing inhabitants.
However, this obvious link is ignored by the article, and, in spite of its promising headline, the article, instead, turns out to be nothing more than another serving of propaganda in the service of the very people who caused the problem in the first place, namely the growth lobby consisting of property developers, land speculators, lenders, construction companies and others who profit from population growth at the expense of the rest of the community.
#SpeculatorsLobby" id="SpeculatorsLobby">Property speculators lobby for higher immigration
Record and escalating property values and the consequent high rents is precisely the intended effect hoped for by the property interests who have been lobbying for population growth behind the backs of the Australian public for decades. Indeed, this hope was openly expressed by an economist working, as I recall for the Real Estate Institute of Australia in 2004 on Radio National's Australia Talks Back program on 19 May 2004 (it is now called just Australia Talks). The topic of the day was the supposed ‘problem’ of a short-lived slump in housing prices, which caused land speculators momentarily not to be able to reap the normally high profits to which they had become accustomed . Several times, the REIQ economist stated that when immigration picks up, the woes of property investors would end.
At the time, I strongly doubted claims that high immigration was, in any way, in the interests of the current residents of this country. In the past I had naïvely accepted the view that the immigration program was undertaken for altruistic reasons, even if I believed them to misguided. Whilst I was becoming more skeptical about this over time, the open acknowledgement of sectional self-interest behind our immigration program was still a surprise to me. I did phone in and speak on Australia Talks Back to make the point that housing prices, even at the supposedly depressed levels, were still impossibly high on a remotely normal income, but I had not sorted out my thoughts on that other question sufficiently as to be able to speak to it coherently. Two days letter at mid-day on Friday 21 May, I sent a letter, in the hope that it would be read out during Friday's "Week In review" program. However that was a week in which an "Australia Talks Books" was scheduled on Friday instead, so it was not read out. The letter was:
Dear Sandy McCutcheon et al,
Firstly thank you for giving me a say on your show on Wednesday.
However, I forgot to comment on what one of your invited guests said, which I thought to be extraordinary and revealing.
He expressed his hope that further immigration will help the property market to 'recover', that is, presumably, that the crowding of further new arrivals into Sydney and Melbourne, will drive the already hyper-inflated housing prices even higher.
This confirmed my suspicion that the motivations of many advocates of immigration were not as altruistic as they had once led me to believe.
Those on the lower rungs of our society were not informed or consulted about the consequences of such an increase in our population, and so now they can no longer afford what was affordable to them a generation ago.
As a matter of urgency, the process of decentralising our economy needs to be commenced, so that everyone can once again find somewhere affordable to live and to work, and before we increase our population levels even further, there needs to be a full and open discussion.
Yours Sincerely
,
James Sinnamon
Housing hyper-inflation the direct consequence of the property lobby's successful lobbying efforts
Subsequently, land speculators and property developers got their wish. John Howard, the man who told the Australian public during the Tampa crisis of 2001, "We will decide who comes to this country, and the circumstances under which they come," secretly ramped up Australia's immigration ever higher and, as a consequence, Australia has some of the least affordable housing in the world. Many, who could previously have hoped to take out a mortgage for a house if they made sacrifices, have been completely priced out of the market as a result, and have no choice but to rent.
Renters at the mercy of ruthless landlords and real estate agents
As the numbers of those seeking rental accommodation have greatly exceeded available rental stock, many tenants are now at the mercy of unconscionable landlords and real estate agents. In 2006, I witnessed the life of a neighbour destroyed during a six month period, as real estate agents and prospective buyers marched into her rented half-house almost at will. On one occasion, whilst the tenant was out, damp washing left hanging, which was considered an obstruction, was dumped on the ground. Eventually the house was sold and the new owners raised the rent beyond what the existing tenant could afford, so she had to move out.
More recently, another rental house occupied by a friend was put on the market. When my friend insisted upon being given adequate written notice by the estate agent before his floor of a two story house was inspected, the estate agent attempted to bully him over the phone. He, nevertheless, stood up to him, asserting his legal rights as a tenant. Fortunately, the landlord was more ethical than most and apologised profusely when he heard of this. The house was eventually taken off the market, and he was allowed to stay. Most tenants, of course, are not so lucky. The Courier Mail newspaper reported (will endeavour to obtain reference) in about two months ago that some Brisbane landlords are evicting their tenants without cause in order to replace them with other tenants able to pay higher rents.
Many who no longer can afford their own unit, let alone a free-standing home, now have no alternative but to share a roof with often incompatible strangers. Those who can't even afford that are resorting to living in cars or in tents in open spaces around the city. One prominent collection of tent dwellings is now to be found beneath the Story Bridge.
Small businesses are also paying the price. As reported in the story Rent gouging threatens Brisbane inner city retail community of 8 Mar 08 sudden exorbitant rent increases imposed by landlords, with the active encouragement of a local real estate agent, destroyed the economic viability of a number business in a formerly cohesive retail community the inner-city suburb of Paddington.
How housing unaffordability scandal is spun to suit the purposes of land speculators
Now, almost invariably, whenever housing unaffordability is raised in the printed media, radio and television, the ‘experts’ whose views are sought are invariably the exact same people who brought about this this human tragedy in the first place. They now would have the public believe that they are all working with single-minded determination to bring housing affordability back to the Australian masses once again. This line is accepted unquestioningly be almost all the newsmedia and the supposedly independent ABC is no exception.
In this story, the ‘experts’ consulted included:
an unnamed spokesperson from economic forecaster BIS Shrapnel,
Steve Greenwood, executive director of the Property Council of Australia,
Dan Molloy, the managing director of the Real Estate Institute of Queensland,
the pro-developer pro-population-growth Lord Mayor of Brisbane Campbell Newman,
In spite of the fact that the ‘solution’ proffered by these people is hotly controversial in South East Queensland, including on the Sunshine Coast and in Redland City, where anti-development councils have been elected, no critical views were reported in the article. The closest thing to a critical view was from Councillor David Hinchliffe, who, as former Labor majority leader on the Brisbane City Council, notoriously surrendered to Campbell Newman on nearly every key policy question, with disastrous results for Labor, during the March 2008 Brisbane City Council elections.
Economic forecaster BIS Shrapnel tipped that house prices in south-east Queensland were likely to rise by 22 per cent over the next three years. The obvious fact that this was almost certainly the result of the Federal Immigration minister Chris Evans having announced that the annual immigration intake was to be increased to 300,000 on 14 May was, of course, not mentioned.
Another contributing factor was Lord Mayor Campbell Newman's sudden hike in council rates directly counter to a clear commitment he made prior to the election of 15 March.
Naturally the whole discussion was couched in terms of what or would not entice investors to invest in rental property.
Campbell Newman and Steve Greenwood differed over the effect that his rate increases would have, with Newman absurdly insisting that his rate increases would have no significant impact upon rents.
Steve Greenwood naturally supported the federal rent-assistance scheme which does nothing but fuel housing inflation at the expense of taxpayers.
Greenwood claimed, as the Property Council invariably states in these sorts of stories, that the solution to housing affordability lies with the release of more land for housing development. In his words:
"But we need other things done, and those other things are increasing land supply.
"At the moment we have a regional plan that is being reviewed."
Mr Greenwood says land will need to be unlocked across the south-east to boost supply sufficiently and take pressure off the housing market.
In one sense Steve Greenwood could be right, to a point.
It is hard to imagine how the supply of more land would not make it cheaper, even if we take into account the extravagant developer's margins and the way that developers, themselves, notoriously withhold the release to homebuyers of land sold wholesale to them by governments in order to maximise their own profits.
If all other things remained equal, we could still expect the affordability of housing to marginally improve. Of course, this ignores the fact that the housing on offer is likely to be distantly removed from any worthwhile amenities, public transport or employment opportunities.
But, of course, all things are not going to remain the same as the greater demand caused by increasing immigration will almost certainly more than wipe out any marginal improvements.
Furthermore, most existing residents strongly object to the loss of open spaces, bushland and agricultural land that will be entailed in the release of new land for housing. As well as degrading the quality of life for existing residents the fragile ecology of the region could be destroyed and, with that any prospect of local food self-sufficiency, vitally necessary when the effects of ever higher fuel costs are inevitably to be felt.
It is for such reasons that the Redland City Council and the Sunshine Coast Regional Council are opposing the Queensland Government's release of more land. In response, Steve Greenwood complained:
"Just outside of Brisbane we've got a number of claims coming from some of the local government areas that actually want to cap their population growth.
"That is very alarming, because basically what they're saying is they're going to … attempt to further limit supply, and for most of us who have even a basic understanding of economics, you limit supply and your costs go up.
Of course, the abovementioned efforts made by the Federal and State governments on behalf of the Property Council of Australia and the REIQ to increase demand are not to be even considered.
This doesn't mean the same thing in France as it would in the US or Australia. France has no major dependency on the housing market. It is not an economy geared to growth in population and rapid turnover. Land speculation is severely taxed and so are inheritances outside direct family. In Paris there are unclaimed buildings because those who would inherit them do not want to pay accumulated taxes. This is a far better system than the one that the Anglophone countries share versions of.
Nonetheless, the news is that sales are down by 27.9% this year and that lots of new investors are unable to find renters. Prices are predicted to decline another 4% this year and then another 6% next year.
The first time there was a housing bubble in France was between about 1989 and 1999. Something like 12,000 realtors went out of business when it crashed.
Graph: "Index of price of dwelling in ratio to disposable Income, using 1965 francs."
Source: L'Observateur de l'Immobilier, No. 43, paris, 1999. The original data source is "Marché immobilier des notaires" (Notaries' property market) and INSEE Annuaire statistique de la France, ed. 2001
This graph was photocopied in black and white so the colour distinctions have disappeared. The top line, indicating higher prices, is always for Paris. The second line is for other French urban centres, and the lowest line, "Province" is for Other Areas, including non-urban.
The graph shows the ratio of disposable income to domestic property prices per square meter from 1979 to the year 2000. Affordability was highest in 1981. Between 1987 and 1996, however, France, mainly Paris, was affected by the same period of global property speculation that affected Australia.
In 2001 I wrote the following in Chapter 8 of my thesis (The Growth Lobby and its Absence) under the heading, "Dwelling Prices and Affordability in France":
"This was the first time France had undergone such a phenomenon [as a housing bubble]. In contrast to Australia, however, the prices returned to the level preceding the speculation bubble. We can observe here that dwelling prices in France, according to this measure of affordability, have risen and fallen quite steeply, but there appears to have been an overall stability, since 1965, when they stopped rising in real terms."
I am not surprised to see that, even though a second bubble followed quickly on the first, prices have come right down again.
Because professional property development speculators do not have much control over the French market, it is actually possible for ordinary citizens to simply hold off buying until prices fall. In contrast, in the US, Canada, Australia, England, where property moguls and their upstream and downstream dependents lobby successfully for high immigration, it doesn't matter if locals stop buying, because the governments will bring in more people. This is totally inimical for civil order and our governments should be covered in shame and thrown out for promoting this horror. Unfortunately, as we often mention on candobetter.org the media control information in the anglophone countries and they also control the global real-estate market to a large extent and they control perception of government and, I fear, government perception. So it is really hard for the public (a) to realise what is happening (b) to organise against it.
In France, although it is possible for foreigners to purchase property, they only obtain work permits if they are Europeans, except in very rare circumstances. So there is not much point in zillions of people jumping in planes and coming over to buy cheap houses and live in France. They would not survive.
Of EU countries, the United Kingdom has terribly costly housing and the English do tend to come and buy cheaper land and housing in France and other EU countries, driving the prices up there. So do some other countries with higher housing prices, such as the Dutch. However these migrants cannot have nearly the same impact as they have, for instance, in Australia. Foreign property buyers find that they also cannot leave their properties to anyone except their children unless they are prepared to be very heavily taxed, so spouses cannot gold-dig so successfully. And, after your first house, you have to wait years to purchase another if you want to avoid the speculative taxes.
The Sydney Morning Herald reports today that there are more than 120,000 vacant residential buildings in Sydney.
A related story details how one Blakehurst resident, Dr Daniel Cox, has set up a wikipedia style website to pinpoint the locations of such properties across the greater Sydney area. In explaining the apparent abundance of vacant properties, Dr Cox says that many of them "..are there because overt speculators have bought them and wait."
"I think we are one of the only countries left that has negative gearing, which makes it cheaper for speculators to own properties than home owners."
Well, yes. I think so too. How refreshing to have someone, NOT from the Property Council or Real Estate Institute, stating the bleeding obvious.
Col James, the director of the Ian Buchan Fell Housing Research Centre, in the University of Sydney's architecture faculty is also quoted as saying "You get the property development industry bleating about how they need to produce 1000 dwellings a week to meet housing demand".
"I say to them, "Well, guys, there's 120,000 houses out there you are not doing anything with."
More common sense.
If Australia were to immediately end negative gearing on investment properties and to implement policies designed to stabilise our population, I wonder whether we'd have a 'housing crisis' at all?
.
Skilled migrant workers from non-English speaking countries granted visas to help Australia's skills crisis are adding to the problem they were meant to assist, new findings show. Less than a third of the migrants coming to Australia on skilled worker's visas are working in their field and are simply adding to population growth and housing pressure, a report by Monash University researchers has found.
Article in MX (Melbourne) 29/4/08
(MX is a free newspaper distributed on trains in Melbourne. It is owned by News Ltd (a division of the Murdoch empire)
See also:Migrants add to skills crisis: study by Harriet Alexander in the Sydney Morning Herald of 29 Apr 2008.
One of many reports about the ongoing and worsening rental crisis in Brisbane, is the article "Wanted: a Room to rent" on page 27 of Brisbane's Courier Mail newspaper of 29 April 2008. The article reports trends where both co-tenancy and room-by-room tenancy is increasing. In the latter case, the room is directly rented by each individual tenant from the landlord. This situation is predicted to grow here in the same way that it grew in the UK between 1996 and 2000.
It is hard to fathom whether the intention of the journalist Paddy Hintz is to objectively report this indicator of worsening quality of life for many Queenslanders or to promote acceptance of it. According to the article, "Rental experts are now predicting that &emdash; for good or for bad &emdash; room-by-room renting will continue its stellar rise," as if this trend could possibly be 'good' for anyone other than slumlords, real estate agents and property speculators.
Alex Poulsen, manager of the University of Queensland accommodation services, was quoted:
“I think what is really interesting is the number of professional people in their 20s and 30s who are now sharing.
“It’s that weird 10-year period where you can’t really afford to live in your own home but you don’t want to live at home either.
“People who live in share houses are getting older, people are getting married later and women are waiting longer to have babies.“
Alex Poulsen tried to portray shared accommodation in a somewhat positive light, when he pointed out that this kind of renting can be a great way to meet people, particularly if want to build a portfolio of contacts.
Of course, this is one of many reasons why people have chosen to live in shared accommodation in the past, but it was more a choice than a necessity, and those who did so could expect to save considerably on rental costs in return for having their personal space encroached upon by strangers with whom they may not necessarily have been compatible. These days it is no longer a choice for many, because of skyrocketing rents.
For those who do grasp the nettle of living with strangers under the same roof, the choices may still be limited. Between AU$155-AU$160 per week seems to be the average for shared accommodation which is proving to be a hurdle for many young people seeking shared accommodation in Brisbane according to Don Foster, accommodation manager of the Queensland University of Technology.
The high rents which are forcing many more than previously would have had to have lived together are the direct result of increased demand for rental properties, caused by population growth that has been directly lobbied for by land speculators. Indeed, in May 2004 whilst listening to an "Australia Talks Back" (now called "Australia Talks") talkback program on ABC's Radio National, I was astonished to hear an economist working for the Real Estate Institute of Australia (or possibly the Property Council of Australia) actually state that they were looking towards an increase in immigration to revive the slump in the property market. They have since got their wish of course, with the help of the Courier Mail newspaper, itself a relentless promoter of population growth#main-fn1">1 and the rest of us are paying the price.
The following article was published in "The Nation" magazine of 20 August 2007.
The author Barbara Ehrenreich is author of Nickel and Dimed, Bait and Switch and Dancing in the Streets. Nickel and Dimed was the inspiration for Australian journalist Elisabeth Wynhuasen's Dirt Cheap of 2005. The two books chronicled the respective experiences of both authors living 'undercover' for a year as low skilled workers on low pay.
Smashing Capitalism
by Barbara Ehrenreich
Somewhere in the Hamptons a high-roller is cursing his cleaning lady and shaking his fists at the lawn guys. The American poor, who are usually tactful enough to remain invisible to the multi-millionaire class, suddenly leaped onto the scene and started smashing the global financial system. Incredibly enough, this may be the first case in history in which the downtrodden manage to bring down an unfair economic system without going to the trouble of a revolution.
First they stopped paying their mortgages, a move in which they were joined by many financially stretched middle class folks, though the poor definitely led the way. All right, these were trick mortgages, many of them designed to be unaffordable within two years of signing the contract. There were "NINJA" loans, for example, awarded to people with "no income, no job or assets." Conservative columnist Niall Fergusen laments the low levels of "economic literacy" that allowed people to be exploited by sub-prime loans. Why didn't these low-income folks get lawyers to go over the fine print? And don't they have personal financial advisors anyway?
Then, in a diabolically clever move, the poor--a category which now roughly coincides with the working class--stopped shopping. Both Wal-Mart and Home Depot announced disappointing second quarter performances, plunging the market into another Arctic-style meltdown. H. Lee Scott, CEO of the low-wage Wal-Mart empire, admitted with admirable sensitivity, that "it's no secret that many customers are running out of money at the end of the month."
I wish I could report that the current attack on capitalism represents a deliberate strategy on the part of the poor, that there have been secret meetings in break rooms and parking lots around the country, where cell leaders issued instructions like, "You, Vinny--don't make any mortgage payment this month. And Caroline, forget that back-to-school shopping, OK?" But all the evidence suggests that the current crisis is something the high-rollers brought down on themselves.
When, for example, the largest private employer in America, which is Wal-Mart, starts experiencing a shortage of customers, it needs to take a long, hard look in the mirror. About a century ago, Henry Ford realized that his company would only prosper if his own workers earned enough to buy Fords. Wal-Mart, on the other hand, never seemed to figure out that its cruelly low wages would eventually curtail its own growth, even at the company's famously discounted prices.
The sad truth is that people earning Wal-Mart-level wages tend to favor the fashions available at the Salvation Army. Nor do they have much use for Wal-Mart's other departments, such as Electronics, Lawn and Garden, and Pharmacy.
It gets worse though. While with one hand the high-rollers, H. Lee Scott among them, squeezed the American worker's wages, the other hand was reaching out with the tempting offer of credit. In fact, easy credit became the American substitute for decent wages. Once you worked for your money, but now you were supposed to pay for it. Once you could count on earning enough to save for a home. Now you'll never earn that much, but, as the lenders were saying--heh, heh--do we have a mortgage
for you!
Pay day loans, rent-to-buy furniture and exorbitant credit card interest rates for the poor were just the beginning. In its May 21st cover story on " The Poverty Business," Business Week documented the stampede, in just the last few years, to lend money to the people who could least afford to pay the interest: Buy your dream home! Refinance your house! Take on a car loan even if your credit rating sucks! Financiamos a Todos! Somehow, no one bothered to figure out where the poor were going to get the money to pay for all the money they were being offered.
Personally, I prefer my revolutions to be a little more pro-active. There should be marches and rallies, banners and sit-ins, possibly a nice color theme like red or orange. Certainly, there should be a vision of what you intend to replace the bad old system with--European-style social democracy, Latin American-style socialism, or how about just American capitalism with some regulation thrown in?
Global capitalism will survive the current credit crisis; already, the government has rushed in to soothe the feverish markets. But in the long term, a system that depends on extracting every last cent from the poor cannot hope for a healthy prognosis. Who would have thought that foreclosures in Stockton and Cleveland would roil the markets of London and Shanghai? The poor have risen up and spoken; only it sounds less like a shout of protest than a low, strangled, cry of pain.
Without a mature discussion on population growth, the housing crisis will extend for years to come, according to Sustainable Population Australia (SPA). SPA National president Peter Strachan says there is deep denial within the government that population is the main factor driving housing demand.
"The housing market is facing the worst housing affordability ever - yet house prices continue to show extreme strength. So what's the housing end game when the majority of people can't afford a home - what's the future for house prices. This video features sections from the video: "If Nobody Can Afford A Home...
Every time I turn on ABC Melbourne radio I am confronted with problems about which I can do nothing. A friend of mine visiting from Thailand described this radio station as “a problem a day,” which resonated loudly with me. The latest problem which gets non-stop air time is “the housing crisis.” Then there is the problem of Melbourne's newer suburbs with only one way in and one way out, keeping cars waiting in long queues to exit on the way to work.
The property development and construction industry is having a lend of Australia: By promoting massive migration numbers, it keeps housing and land costs high and it keeps its own costs low.
The following is an excerpt from the Guardian, 14/03/2022, pertaining to Premier Daniel Andrews. Andrews also suggested the “great Australian dream” of owning a home was less important to younger generations, especially given the increasing cost of property – the median price of a home in Melbourne is now $1.1m.
"The Affordable Housing Party: the single issue party dedicated to solving Australia's housing affordability crisis. Australians are now living with some of the most unaffordable housing in the world, but it doesn't have to be this way! Obscene tax incentives to invest in property. Our lawmakers profit from the status quo. We opened up our housing market to investors all over the world. Australia's rapid population growth. Home buyers are paying too much to try to compete with investors. This can't go on forever!" Former journalist, Andrew Potts, Sydney, registered the Affordable Housing Party (AHP) with the Australian Electoral Commission earlier this month. Policies include: Phasing out negative gearing and capital gains discount on investment property sales; Stopping overseas buyers from buying Australian properties; Taxing properties left empty by investors; Cutting down immigration to 70,000 annually; Banning full time Airbnb properties; Ending “no fault” evictions for rental properties. Facebook page is https://www.facebook.com/AffordableHousingParty/
Chinese investors are often blamed for Australia’s escalating house prices but a number of factors might mean the demand will drop off in coming years. A recently released report found investment in residential real estate by the Chinese is slowing. As the gap in rental yields between the two countries closes and house prices increase, Australian residential real estate is beginning to look less attractive. The lifting of restrictions on Chinese urban residential property ownership and personal investment monetary restrictions may also play a part. [Article first published on The Conversation, May 1, 2017]
"For more than a decade, the Productivity Commission has debunked the common myth that immigration can overcome population ageing. [...] If Australia was truly a ‘clever’ country like Japan, it would manage population ageing by: 1) better utilising existing workers, given there is significant spare capacity in the labour market; and 2) where required resort to technological solutions. The last thing that Australia should be doing is running a mass immigration program which, as noted many times by the PC, cannot provide a long-term solution to ageing, lowers wages, and places increasing strains on infrastructure, housing and the natural environment." This article first published at #comments">https://www.macrobusiness.com.au/2017/06/poor-old-japan-low-unemployment-less-crowded-cheaper-housing/#comments
A growing number of French people own their own homes. Ownership runs at 64% today, and is expected to grow to 68% in the next six years. France is well behind other European countries though in home ownership. The champions are in Eastern Europe. 96% of people own their own homes in Romania. 70% own their own homes in Italy. Seven out of ten French home owners have entirely paid off their home loan. For people purchasing today, the average time to pay off a home is 17 years. This is a situation to dream of for Australian home-buyers, who are only second to Hong Kong's in suffering under a terrible system. The French system discourages land-speculation in a number of ways which therefore deter the flourishing of a malignant property and growth lobby there. This article is based on a France2 news item "L'achat immobilier, une valeur sure plébiscitée par les Français," 29 January 2016.
Five million people in France own more than one property. 700,000 own more than four properties. Bricks and mortar are the preferred investment - more than the National savings account (le Livret A), bank shares, life insurance or gold.
"Address population growth, tax concessions and foreign buyers." (Sustainable Population Party). The federally registered Sustainable Population Party says Australia’s housing affordability crisis is largely driven by demand-side factors, rather than supply-side issues. The party will take its message to the street at upcoming auctions across Melbourne, including The Block Auction on Sunday October 11.
William Bourke, President of the Sustainable Population Party comments on Australia’s housing affordability crisis, and the activities of the Party to tackle this problem, which included large Melbourne auction visits and a Senate enquiry submission into affordable housing (submission 89). The Population Party submission emphasises that the Australian Government’s policy goal must be to stabilise real estate prices. It argues that:
The Vietnam War led by the US spanned most of the 1960s through to 1975. The famous motto “All the way with LBJ” developed as a result of Australian PM Harold Holt’s commitment to military support of the US led War in collaboration with Lyndon Baines Johnson, the US President.
They are buying houses and farms in order to exploit opportunities for profit, including removal of food from Australia. We have empty houses throughout the suburbs of capital cities that may have been purchased to diversify some foreigner's asset portfolio. 
Rudd's penchant for a 'big Australia' is behind his absurd record immigration policy. Population growth and congestion is out of control and is the common denominator driving up Australian land prices, electricity, water, inflation, consumer demand, interest rates, and consequently the costs of living of ordinary Australians.
Ageist ABC baby-boomer bashing - incites blame against older people for housing crisis.
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