No Housing Supply Issue

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One of the most repeated comments made by fiscal conservatives about the housing price increases is that really it's a supply issue. Just get rid of red tape, and allow for more houses to be built. But have they driven through the outer suburbs of any major city lately? There's housing developments everywhere. Indeed, Australia wide there is a surplus of houses. There is no housing supply issue, that is a mistake that some people make, and a lie that others make who should know better. 

There are about 1 million empty homes in Australia. Think about that.  

Houses are not limited by supply, they are limited by investment ownership. Some of those houses are empty because people are about to move between homes. Some houses are vacant because they are part of deceased estates. So, some of these homes are vacant for unavoidable reasons. But others are empty because some are being kept to be sold in better conditions, and others are empty because they are second, third or even fourth homes, and many of these vacant homes are investment homes, owned by moderate, to very wealthy people, and some are even holiday homes of the reasonably well off. 

But for whatever reason they are vacant, 1 million empty homes shows there is no supply problem. There is a logistics problem. We have a problem getting the homes to those who really need them. Many are being hoarded creating excess demand. 

In an economy where wealthy investors have the most money to buy, releasing a lot more land and lowering building costs will not solve many housing issues, because those with investment capital will just by more homes. Plus, there are excess homes already and the housing costs are still increasing. What needs to happen is that governments need to make laws which disincentivize people from investing in homes. As long as there are good incentives to invest, house prices will remain artificially high. Taking the incentive to invest away is the only real solution. Though making it hard to borrow large amounts of money to help people invest would also help. 

You know who doesn't want someone saying that? Investors, which includes many of the people in government positions and positions of influence. That's why so many of them are freaking out about the Queensland government's tiny move to get more tax from investors with houses on other states. House investors have been a privileged class who have ridden off the backs of the poorer people for too long. They do not like their gravy train being challenged even if ordinary families suffer as a result of their hoarding of homes. 

#isaiah5verse8 God told us this first, that a land where some people buy up all the land is a cursed land. We are in the process of finding out, again, why God is right. 

Breaking the hold of investors on properties and getting rid of the constant pressure of immigration on house prices, would make owning a home more affordable for the average Aussie family. This should be a priority if governments in Australia.