As Australia navigates through a housing crisis, new policy promises from major political parties have drawn both support and skepticism. The federal government has just pledged $10 billion toward building 100,000 new homes for first-time buyers only. In the eyes of many citizens these all represent very needed steps that at best do too little to correct the deep flaws in our housing market.
For Jason Quince, a property owner with several hands in local real estate investments, new housing policies create opportunities for people like him to prosper. Even with his financial independence, Quince is a passionate proponent of expanding opportunities for others to gain a foothold in the market. The current market makes many potential first-time buyers feel discouraged and disenfranchised. These activists include Angela Ramsey, a single mother and educator, and Chloe Angel, a young adult.
Divergent Perspectives on Housing Policies
Greystone Senior Managing Director Jason Quince is a strong proponent of government housing initiatives that he says will help property owners build equity. “I’ll definitely benefit; it’ll give me more equity or let me buy more so there’s no downside,” said Quince. Simply put, he has much to gain from the implementation of these new policies. He is incredibly passionate about helping more people realize dreams of home ownership.
Quince highlighted his family’s struggles, mentioning, “I’ve got three sisters, none of them have a house, so I want to see other people get into it like I did.” His sentiment is echoed in the concerns of most homeowners. What they don’t see is a huge gap between their situation and the situation of hopeful first-time buyers.
In sharp relief, Angela Ramsey’s experience highlights the precarious reality for too many other Australians. As a nurse and single mother in Sydney, she has worked tirelessly, taking on overtime shifts and receiving an inheritance that allowed her to save over $60,000 for a home deposit. But even after all this work, banks wouldn’t give her enough funding to cover the cost of a mortgage. Her story is a testament to the struggle all-too-many endure to find accessible, affordable housing even with the government’s assurances.
The Economic Landscape and Its Challenges
Economists scold that the central wrongs are only deepened by the fixes set out in the bill. Dr Nicola Powell, Chief of Research and Economics at Domain, points out the shocking reality. The current housing supply is not nearly enough to satisfy the expected demand spurred by these initiatives. “We are not meeting the targets of building that 1.2 million homes over the next five years, and that is because it is so costly to construct,” she stated.
Dr. Powell went on to weave a horror story of how these policies would increase property values. “You have the wave of first home buyers utilising these benefits and these incentives… what that will do is boost property prices and just make it harder for the next wave of first home buyers,” she said. This smart analysis raises some great questions. Will these steps really get people who need it into homeownership, or will they continue to drive up prices?
Here’s how economist Chris Richardson summed up his position. He argues that there’s a housing supply crisis in Australia, not a crisis of too much money chasing too few properties. “We don’t have too little money chasing housing in Australia; we’ve got too little housing,” he remarked. He blasted Republicans and Democrats alike. They promised more money, but didn’t deliver real change for enough new construction to significantly ease our overwhelming, urgent housing crisis.
The Struggles of Aspiring Homeowners
Chloe Angel is a voice for her generation struggling with the challenges of home ownership in Australia. She has worked hard all her life to save responsibly but is now lost by the current market forces at play. “The current housing market is exhausting,” she declared. Angel, for her part, feels that her generation has been unfairly hit hard by the skyrocketing costs and lack of options.
Even with a good, stable job and helpful parents, Angel is still squeezed on what she’s able to buy. “I think on the surface they sound great and sound like they’re going to make homes way more accessible to people, but with my income and job and situation… I am only capable of getting a loan of up to $400,000 regardless of how much I have for a deposit,” she explained.
Angel challenged the popular narrative of bootstraps that is frequently echoed by older boomers with multiple home investments. “There’s a lot of boot straps rhetoric going around from older Australians who own multiple properties,” she noted. This attitude unfortunately breeds despair among younger adults who are looking to enter the housing market.
