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Thursday, 22 September 2011
Page: 11260


Mr BANDT (Melbourne) (16:40): In parliament this week a new and important campaign was launched to challenge Australian governments to address housing affordability. Australians for Affordable Housing is a coalition of national housing, welfare and community sector organisations. They say housing affordability is the single biggest cost-of-living issue facing Australians.

I know that in my electorate of Melbourne people are under enormous housing stress. Rent hikes, a shortage of housing, mortgage stress and a market that locks out first home buyers all contribute to the problem. Housing costs are both the biggest item in household budgets and the fastest increasing cost, rising by 55 per cent over the last six years and causing enormous housing stress. In the last 10 years house prices have risen by 147 per cent while incomes have risen by only 57 per cent. In the last five years rents have risen at twice the rate of inflation. From the 1960s to the 1990s median home prices in Australia were between three and four times the average annual income. Since then they have gone through the roof to between seven and eight times average incomes.

The high cost of housing puts enormous pressure on other areas of essential spending, such as food, health care, transport, education and health. According to the housing coalition, households across the country are paying more than they can afford for housing, with over 740,000 renters and more than 380,000 mortgaged homeowners reporting significant financial stress.

The housing market is also locking out young people from buying homes, with home ownership amongst 25- to 44-year-olds declining by 15 per cent in the last 20 years. It is also particularly bad for students in my electorate who struggle to live close to their university or TAFE. During the election campaign, I met someone living in an unremarkable three-bedroom brick house in Collingwood, paying $190 a week in rent—the rent for the whole house was $540 a week. The $190 he was paying is more than his youth allowance. Many others are in the same boat.

This week I asked my followers on Twitter and Facebook what their experience of housing stress in Melbourne was like. I got an avalanche of responses, and here are some of them:

On a higher-end public servants wage, no way I could afford to buy in electorate Melb. A lifetime of rent ahead?

Long term stability at the bottom of the market is absolutely lacking. I've lived in three houses since I first moved here in 09.

Would like to see some kind of rent control implemented. Non-house owners need some security.

I used to live in Melb LGA. Had to move out as student due to affordability issues. Very frustrating.

Housing affordability also has an impact on the wider economy. As Australians for Affordable Housing correctly point out, existing housing is a non-productive investment. In other words, that investment does not directly generate wealth or add to production once it has been constructed. So high prices mean that Australians are spending a large proportion of their income on a non-productive asset that would otherwise be spent on wealth-generating investment.

The most extreme manifestation of the failure of the housing market is the number of Australians who do not have a place to sleep—over 100,000 on any given night. Homelessness is a difficult problem with a complex set of causes, but we will never come to a solution to homelessness without affordable housing. It is time we had a national plan to return fairness and equity to the housing market. There are a number of elements that need to be part of that plan. We need to look at everything, from the tax system to greater investment in social housing.

In my electorate of Melbourne, at the moment the rule seems to be: if there is an old warehouse or spare space, knock it down and build expensive apartments. This includes sections of public housing land that is tagged for private development. This is a twofold loss to the community: a loss of public land and a lost opportunity for more affordable housing. Councils must be better able to place requirements for social and affordable housing as part of development projects. Social housing targets should be part of structure plans and strategic statements. It also means greater investment on the part of state and federal government in public and social housing.

It is time we had an economy that puts people first. It is time that we addressed the enormous housing stress that people are experiencing. It is time for our governments to fix Australia's broken housing system. In the coming months I am looking forward to working with members of Australians for Affordable Housing and my Greens colleagues to address this burning issue. Now is the time for action and a concerted effort to make a difference to people's access to housing.