Economic News, Investor News

Housing Affordability and the Australian Federal Government Election August 2010

The Housing Industry Association of Australia approached all major political parties and asked the hard questions regarding critical policy issues.

What is the policy position taken by each major party including the Australian Labor Party, The Liberal National Coalition and The Greens. Find out about housing affordability…

Housing Affordability
 
What policy actions would you take to reverse the decline in housing affordability?

Labor

The Gillard Labor Government understands that there is not enough affordable housing in Australia.

That’s why the Gillard Labor Government has committed nearly $20 billion to housing programs to build more affordable homes for Australian families.

Federal Labor’s housing policies are primarily directed at increasing supply. For around a decade Australia has not been building enough homes.

The First Home Owners Boost helped more than 250,000 people into their first home during the Global Financial Crisis.

Federal Labor introduced First Home Saver Accounts. Prospective home buyers can open a First Home Saver Account – the Government makes matched contributions (to a certain value) to these Accounts, and less tax is charged on them than on other savings accounts.

In addition, 76 local projects have been funded under the Housing Affordability Fund – delivering savings to around 14,000 home buyers in new developments. 380,000 more households will benefit from planning and development reform that has brought forward new lots and made development regulation more efficient.

The Gillard Labor Government will deliver 80,000 more affordable rental homes across Australia particularly for low and moderate income earners.

This includes funding to build over 21,000 new social housing homes.

In addition, Federal Labor established the National Rental Affordability Scheme to encourage the private sector to build 50,000 homes and rent them to low and moderate income earners at 20 per cent below market rate. The Gillard Labor Government recently announced the construction of 1,200 new affordable rental homes in Darwin and Palmerston under the NRAS.

The Gillard Labor Government is working with the States and Territories on reforms to lift the rate of new housing construction.

Further, the Gillard Labor Government has announced Building Better Regional Cities, a new $200 million program to help build more affordable homes so that Australia can grow sustainably.

Building Better Regional Cities will give successful councils new funding to invest in local infrastructure projects that support new housing developments like connecting roads, extensions to drains and sewerage pipes, and community infrastructure such as parks and community centres.

Up to 15,000 new homes for working families will be built through this program over three years in regional cities.

It will also contribute to addressing the problem of housing supply in Australia and relieve pressure on our existing urban centres such as Melbourne and Sydney.

Coalition

The Coalition is committed to making homes more affordable so more Australians can realise the dream of home ownership. We believe home ownership should be encouraged, and we support government measures that encourage home ownership.
The Labor government has spent billions of dollars on so-called ‘housing initiatives’ since 2007, yet housing affordability has actually declined.

The government’s first home owner saver accounts, for instance, have failed: the government predicted that 730,000 people would have taken up the First Home Saver account program by 2012. As of October last year, only 11,000 people had taken up the program. That program is estimated to cost taxpayers $180 million over the next few years.

Rental and mortgage stresses have increased, and homelessness has worsened under Labor. Rents have increased 6% annually on average since December 2007, more than twice the rate of increase experienced under the last Coalition government. House prices in our capital cities are higher than they have ever been. Between March 2009 and March 2010, house prices surged by 20%, and there have been six interest rate increases since October 2009.

Labor’s addition to borrowing and spending will make rate rises more likely in the future.

The Coalition has a strong track record of providing strong, sustainable economic growth with low unemployment and relatively low interest rates. In these conditions, more Australians have the ease and the confidence to pursue the dream of home ownership.

The last Coalition government provided more than $5.9 billion to first home buyers, under the First Home Owners Grant scheme. We provided more than $2 billion annually in Rent Assistance to more than 900,000 low income earners residing in private rental accommodation.

The Coalition will end Labor’s reckless spending and restore prudent economic management to Australia’s accounts. This will reduce the likelihood of interest rate rises and make housing more affordable for Australians.

The Coalition believes encouraging a greater supply of housing is the best way of improving housing affordability. The Coalition will work with State, Territory and local governments to improve the supply of land. We also believe slow land release rates and cumbersome planning approval processes are making homes less affordable. The Coalition will work through the existing COAG framework to ensure relevant and effective reforms are pursued to mitigate supply bottlenecks and unnecessary red tape.

We will also give local councils and local communities a say about where social housing developments take place. State Labor governments too often give scant regard to the wishes of their local communities before signing off on unwanted local housing developments.

Greens

The Australian Greens believe that governments are responsible for ensuring the housing needs all Australians should be met through a mix of affordable housing options, including shared equity schemes, and innovative well-funded affordable rental, student, community, and public housing solutions. We have been successful in many of our housing demands of the 2007 election such as significantly increased spending in social housing, a Minister for Housing and a national housing plan.

We succeeded in negotiating for all stimulus housing spending (in excess of $6 billion) being six star efficiency rating or higher, and Senator Rachel Siewert led the 2008 Senate Inquiry into housing affordability. Our aim is to introduce a national target of 20% affordable and social housing.

Who would get your vote?

Source: HIA Media Release

 Subscribe to our FREE newsletter or RSS feed. Receive updates in My Yahoo!, Google, and others. .