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The so-called affordability crisis means an entire generation of young Australians could miss out on owning their homes. Outgoing LJ Hooker CEO Grant Harrod flags three government policy priorities to solve the rapidly escalating problem.
1. Essential service workers
Mr Harrod says recent strong price growth across Australian capital cities has seen low-income and essential service workers such as teachers, nurses and emergency service workers priced out of most inner city markets.
However, these areas still require the services that these workers provide.
“The provision of affordable housing for these low and middle-income families is required to ensure a diverse range of households have access to housing across all areas of our capital cities,” he says.
“However, at present, it has not been feasible for developers to provide affordable solutions.”
Mr Harrod says the government needs to step in with incentives to ensure the delivery of affordable housing can occur.
2. Stamp duty
The high cost of selling, buying and moving home has reached a point where people are reconsidering and/or delaying their next property move.
“Recent strong price growth, and the fact that stamp duty is calculated on the value of the property, means that it has reached a point where it is having a big impact on the budgets of property buyers,” Mr Harrod says.
“The scrapping of stamp duty would directly assist housing affordability by helping increase the mobility of the population and encourage owner-occupiers to upsize and downgrade into a property that suits their changing needs without being slogged with an exorbitant tax.”
This, he says, will ensure more properties become available for sale, helping balance supply with demand and ensuring more families get to live in their home of choice.
3. Decentralisation
According to Mr Harrod, the growing population across all capital cities combined with the increasing cost of providing infrastructure means that decentralisation of businesses, households and government departments is becoming essential.
“With more than 90 per cent of the Australian population living in capital cities, there is a need to incentivise businesses to relocate or start-up some or all of their business in our major and minor regional centres,” he says.
Mr Harrod points out that this regionalisation is likely to boost the economies of these smaller regions and provide employees access to more affordable housing.
“It will also elevate some stress and demand on infrastructure, services and housing in capital cities.”
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