The House of Representatives Standing Committee on Tax and Revenue has launched an inquiry into housing affordability and supply in Australia.
Committee chair Jason Falinski MP says the official data shows home ownership as been falling for the last 30 years. “This represents an urgent moral call for action by governments of all levels to restore the Australian dream for this generation and the ones that follow,” he says.
“The research points to limitations on land and restrictive planning laws as the major causes of shortages in supply. As consistently noted by the RBA and others, regulatory settings are directly responsible for the unresponsive nature of housing supply in Australia.”
The Organisation for Economic Co-operation and Development (OECD) conducted an analysis of Australia’s housing market, particular its very high ratio of housing prices to household incomes. The OECD concluded that Australia’s unusually high level of inelasticity in housing is the major driver of this ratio.
“This is best demonstrated by the fact that residential building approvals decreased 44% from 2016 to 2020 compared to the previous five-year period,” Falinski says. “Meanwhile, market supply has collapsed with new home listings down to record lows according to CoreLogic.”
