Albo’s “one million” homes pledge classic Scotty from Marketing


Recall that Treasurer Jim Chalmers announced on Budget night that the federal government would aspire to “build one million new, well located homes over five years from 2024”.

I rubbished this announcement on Wednesday noting that 1.8 million dwellings were completed last decade anyway. So:

Will Chalmers’ “one million” new homes be in addition to this? Or will the new scheme simply replace what was going to be built anyway? And where will the extra tradespeople, builders and materials come from to build these extra homes?

I suspect Labor will just try to take credit for what would have been built anyway, while funneling financial kickbacks to its mates in the superannuation industry.

Former RBA head of research and chief economist at the Centre for Independent Studies, Peter Tulip, has also questioned the merits of Labor’s “one million new homes” pledge:


The budget’s announcement of 1 million houses over the next five years will do very little to improve housing affordability.

One million homes is about what we built in the past five years (974,732 dwellings, to be precise). Relative to the size of the economy, 1 million will, in fact, be a step down.

The demand for housing has risen due to low interest rates and more of us working from home. Looking forward, increased immigration and rising incomes will add further pressures…

The result has been a record low vacancy rate, soaring advertised rents and some of the highest house prices in the world.

We are essentially being promised more of the same – even though recent levels of supply have been clearly inadequate.

Consistent with the unambitious target, specific policy announcements were small.

The centrepiece was an increase in subsidised housing. On top of the 30,000 dwellings previously announced, there will be a further 10,000 from the federal government and 20,000 from the states.

This adds up to 60,000 new dwellings, which is an increase of only 0.6 per cent of our national housing stock of 10 million dwellings. That tiny increase will have a negligible effect on housing prices, though a large cost to the taxpayer.

I will add that this tiny 0.6% increase in our national housing stock will be swamped by Labor’s mass immigration policy, with the budget forecasting 940,000 net overseas migrants over the forward estimates:

Net overseas

Alongside an increase in Australia’s population of 1,460,000 over the budget forward estimates:

Population growth

Thus, the housing supply situation will get worse under Labor due to its ‘Big Australia’ immigration policy, which will swamp the extra housing supply.


This is classic Scotty from Marketing.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.