There is an “acute problem” in our capital cities which governments are ignoring – but will property investors bear the brunt of the inaction?
The Household, Income and Labour Dynamics in Australia Survey has ignited new discussion on the level of relevance the government places on the relationship between negative gearing and housing affordability.
Following findings in the HILDA survey that fewer than half of Australian adults will own a home by next year, the Property Council of Australia has issued a statement saying that this should serve as a 'wake-up call' to governments on the case for fixing housing supply and affordability.
The Property Council of Australia’s chief of policy and housing, Glenn Byres, said sliding home ownership is a damning report card on the collective failure of governments to act.
“Housing affordability has remained a public policy orphan for too long, and there is a compelling case for change given the acute problem in our capital cities.
“Neither side of politics took a comprehensive plan to the last election. Instead, we saw a tax debate on negative gearing masquerading as a housing affordability debate.”
Meanwhile, founder and executive chairman of The Hopkins Group, John Hopkins, shares the sentiment that negative gearing policy and housing affordability issues should not be confused as one and the same.
“In the eighties, whilst I disagree with what Keating did, I said to [him] ‘it's not right that people can buy an investment this year, claim the losses as an investment, sell it next year, make a capital gain, and claim the losses as well’,” Mr Hopkins said.
“That's wrong. But not if someone is a genuine long-term property investor, the type of investment they purchase is relevant, and the time that they own it is relevant to prove that they are genuinely waiting to get an income.
“Where does the Labor party think the accommodation will come from that Melbourne and Sydney need, let alone Brisbane — because Brisbane’s percentage increase in population is bigger than Melbourne and Sydney — where do they think it's going to come from?”
According to Mr Hopkins, the greatest proportion of The Hopkins Group’s database is “just ordinary Australians”.
“Sure, there are some wealthy people on there, but it's not the predominance. The predominance by 85 to 90 per cent is easily just ordinary Australians,” he continued.
“I'm not trying to be political, because I'm happy to look at both sides of politics on various issues, [but] Labor are very much impacted by this sort of class thing, and it appeals to the worker to think they are getting into the wealthy people.
“But don't we want people trying to provide for their own future? Property is part of it. And in addition to providing for their own future, relying less on government, they are also providing accommodation. I don't get it.”