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It's time we took the high cost of housing seriously

By Adrian Pisarski - posted Friday, 4 June 2004

All Australians are concerned about securing a roof over their head and for many affordable housing remains out of reach. Yet this basic need has not been given the attention it deserves.

Housing is in a state of crisis with increasing numbers of Australians being left homeless or unable to sustain increasing housing costs.

On any given night in Australia, more than 105,000 people are sleeping on the streets. In 2001-2002 supported accommodation services reported a total of 50,800 children accompanying homeless adults.


The great Australian dream of a house and yard has eluded many families. Often those with a place to live struggle to meet rental and mortgage costs. Australians on the lowest 20 per cent of incomes spend on average 64 per cent of that income on housing costs.

There are 250,000 people living in capital cities suffering what is known as extreme housing stress. Housing stress is experienced when a household’s accommodation costs do not leave sufficient income to afford the other necessities of life. If the current trends continue, this figure will rise to 1 million by 2020.

In the meantime, government support for people needing low-cost housing has decreased. Public housing has declined from 6.2 per cent of total housing stock in 1994 to 4.7 per cent in 2001 (ABS 1996 & 2001). The overall decline in funding under the Commonwealth State Housing Agreement (CSHA) over the last decade has been inconsistent with the increase in housing related poverty. The Australian Government has not increased its direct expenditures and tax incentives to encourage the provision and financing of affordable housing, despite the urgent need for such assistance.

It has been estimated that to address the existing shortfall in private rental accommodation would require an additional 150,000 homes. To put this in perspective, that is around the total number of new homes built in Australia in a typical year.

First home buyers are becoming rare. Despite direct grants and stamp duty concessions, the first home owners’ share of the housing market has plummeted. In March 2004, to buy a median first home in Australia required a minimum household income of $77,400 (pdf, 37KB).

Government policy settings through regulation, taxation and spending can impact substantially on housing markets. However, current settings do not adequately take into account their effect on the availability and cost of housing services. The absence of a dedicated housing policy focus has led to a boom-and-bust real estate cycle which excludes many Australians from entering the market.


Clearly, leadership is needed to raise the alarm over these issues and to point the way to a more sustainable approach to housing. With this view, the National Housing alliance was formed and is today issuing a Four Point Plan to begin grappling with accessibility and affordability of housing.

Point 1:

The National Housing Alliance calls for the Australian Government to commit to the goal of affordable housing for all Australians and develop a National Housing Policy led by a Minister for Housing at Cabinet level.

Point 2:

The Australian government should adopt fiscal and supply side initiatives to increase the availability of affordable housing for the home ownership, private rental and social housing segments.

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Article edited by Robert Standish-White.
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About the Author

Adrian Pisarski is spokesperson or the National Housing Alliance.

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