What’s the point of another housing inquiry?

Fairfax’s senior economics writer, Jessica Irvine, wants another housing affordability inquiry chaired by former Treasury secretary Ken Henry:

[We need] a high-level Treasury review, of the ilk of the Ken Henry tax review…

So, I texted Henry to see if he’s up for it. He replied: “Jess. Sure. I’d chair such a review. The question is whether we have a government with the courage to commission it. Ken.”

Call it an elephant, or call it a gorilla, what’s crystal-clear is that Australia’s growing housing affordability crisis is wreaking havoc on the quality of life of all Australians and it needs to be stopped.

Australia’s governments have run numerous housing affordability inquiries over decades, including but not limited to:

  • Menzies Research Centre: Prime Ministerial Taskforce on Home Ownership 2003;
  • The Productivity Commission’s First Home Ownership Report in 2004;
  • A Good House is Hard to Find Report from the Senate Select Committee on Housing Affordability in Australia in 2008;
  • Western Australia’s Affordable Housing Strategy 2010-2020;
  • NHSC: State of Supply Reports (2008, 2010, 2011, 2012, 2013 onwards);
  • Senate Inquiry into Affordable Housing, 2014-2015; and
  • Parliamentary Inquiry into Home Ownership 2015.

On top of these we have gotten many reports from think tanks like the Grattan Institute, the McKell Institute, and others.

Thousands or work-hours and millions of dollars worth of salaries and consultants’ fees have been spent on these reports and absolutely nothing has come from them.

So what is the point of wasting more taxpayer dollars, and feathering the nest of Ken Henry and his ilk, by running yet another ‘housing affordability’ report? Nothing will come from it because our politicians don’t actually want more affordable housing, since this requires prices to fall.

Stop wasting every bodies’ time and money with false promises.

Unconventional Economist
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Comments

  1. working class hamMEMBER

    Stooge offers up idea, 2nd high profile stooge agrees if “Govt has the balls!”, whilst cleaning out coffers.
    LNP gets public mandate to implement next round of FHB stimulus/tax deductible PPOR/super drawdown hybrid chicanery and the merry go round starts up again.

  2. Jumping jack flash

    “So what is the point of wasting more taxpayer dollars, and feathering the nest of Ken Henry and his ilk, by running yet another ‘housing affordability’ report”

    Well, its very important because a few pollies must have some mates that are getting a bit low on government coin…

    But all jokes aside, housing affordability isn’t the problem and as such it can’t be “fixed”. Any government who decides they will “fix affordability” is destined to fail. It simply isn’t a thing.

    The problem is debt eligibility, and that isn’t too difficult to fix at all, especially for the LNP “bank whisperers”.
    If someone becomes eligible for the correct amount of debt that is required to buy a house, then that house becomes affordable. Its kind of like magic, but not.

  3. CONCLUSION:
    The enquiry has found that, on balance, housing in Australia is expensive.
    Our recommendation is to do sweet FA about it. PEACE OUT BEEEAAAATCHES!

  4. The point is, to make it look like you care, whilst simultaneously doing the opposite in order to fix the issue. Then when the inquiry finishes, say that sounds like a great idea. Sit on it and do nothing. Then when the next Government takes over (say Labor) they can say we will fix it by making it easier for FHB to enter the market via subsidies, the average punter goes “how good is this?” takes the bait and around we go..

    • It’s also an opportunity to proclaim loudly and with authority (Ken Henry said it!) that it’s a supply issue. Greater deregulation, more privatisation, less red tape, fast track this and that, etc etc. Probably some subsidies for developers too.

    • Jumping jack flash

      Yep. Debt eligibility subsidies for the win.

      There is an actual fix for affordability but its a lot of effort and not guaranteed to work anyway.
      The only real “fix” is to build substandard, “affordable” houses. But due to the fantastic valuation system we use in this fine country, those new houses will need to be built very, very cheaply, and situated far away from any amenities, and far away from “unaffordable” houses that already have debt attached to them. i.e, built in the middle of nowhere, preferably in the desert. A bunch of old shipping containers dropped into the desert complete with a few rusty holes for windows would do the job nicely.

      Otherwise, the newly built affordable houses will rise in price and become unaffordable and that would defeat the entire purpose of them, and/or they may drag the prices of the surrounding houses down, and we can’t have that, the banks would simply not allow it.

      The former scenario happened in the UK several years ago with some “affordable” units.

  5. What’s the point of another housing inquiry?
    Hmmm That’s one of these Zen questions isn’t it?
    What’s the Meaning of life?
    Am I coconscious now?
    Is there a Point to Politics?
    Good luck with your discoveries, for me the journey is all that I have.
    The time to worry is when you’re asking yourself, what’s the point of the journey?

  6. MB may like to focus on more reporting with predictions based on vested interest rather then economical fundamentals otherwise housing forecasts on what should be could be would be will continue to fall short. Issues have included population growth, changing lifestyles, buyers perception of safe places to invest, continuation of negative gearing, curtailing of APRA protections, RBA pumping, etc which have had greater impact than the other factors considered over the years.

  7. kierans777MEMBER

    What’s the point of another housing inquiry?

    The only reason to have it is to get negative gearing, and CGT reforms back onto the policy agenda. Sure it’s not actually needed, but it could be useful politically.

      • kierans777MEMBER

        The Banking RC was never about cleaning up the banks, but targeting industry super funds. The Banks helped write the terms of reference after all. Let’s see what might happen with a different government.

  8. 103rd Username

    In a country like ours where the political class is entirely captured by vested property and finance and construction interests. No point whatsoever other than window dressing. Not even the Greens would accept the consequences of lower house prices.

  9. Any media organisation that has Jessica as a “senior” economics writer has no idea. She did not think ETFs paid dividends:( WTF