Australia’s Housing Crisis Is Not New
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The housing crisis we are currently experiencing here in Australia, with rents going through the roof and a shortage of rental stocks, seems to be something terrible and uncharacteristic of the nation but it isn’t. Australia’s housing crisis is not new, in fact, it is a well-trodden path that we appear to traverse quite regularly. History tells us that housing has been a persistent problem upon our fatal shores for as long as white settlement has been around. There have been peaks and troughs but a shortage of housing stock has been the constant over hundreds of years. Therefore, the federal government’s identification of the cause may not be reason enough to hold out hope for any quick solution to this perennial issue.
The Housing Crisis & Australian Governments
Governments are saying, if there is a shortage we will build more houses but this has been much harder to achieve than mere words suggest. National cabinet has come together to meet the challenges presented by so many levels of government involved in housing in this country. Local governments, made up of volunteer councillors, have traditionally been involved in limiting development in their locales. Low density housing has long been a desirable outcome in this regard for those wishing to protect and enhance property values and lifestyles in their neighbourhood. Federal and state governments are threatening to impose their will upon recalcitrant local governments to combat this.
History tells us, however, that this problem does not easily go away.
The History Of Housing Affordability Crises
The housing affordability crisis in Australia has a long history in white settlement terms. Tent cities around Melbourne and the goldfields were common in the early 19C. These morphed into low grade structures, like the workers cottages and slums in the inner cities of the capital cities.
“In Australia’s early years, much of the housing stock was of poor quality, often overcrowded, and posed real risks to people’s health. Slums were common in the inner parts of the major cities and in many country towns. As late as 1915 bubonic plague was a reality in the poorer parts of our cities and other contagious diseases remained an ever-present risk. Numerous letters to the editor documented a real social concern with the housing standards of the poor.
Government intervention, economic prosperity and tenancy laws all improved housing conditions across Australia. Within a century Australia was defined by good housing and high rates of home ownership. The nation saw off the last of its slums in the late 1940s.”
Australia was not the wealthy place it is for many today and the structures which housed its inhabitants reflected that reality.
“As the Second World War drew to a close and the Australian federal government focused its attention on the significant task of post-war reconstruction, the problem of a shortage of affordable and suitable housing was a major concern (Troy Citation2012; Macintyre Citation2015). The cumulative effects of the Great Depression and the channelling of building materials and labour into the war effort had produced a shortage of housing estimated to be in the range of 300 000 dwellings (Commonwealth Housing Commission (CHC. During this period, the quantity and quality of housing in Australia was extensively troubled. Dedman, the Minister for Post-war Reconstruction, argued in his introduction to the second reading of the Commonwealth State Housing Agreement Bill (CSHA, 1945), that
… the principal deficiency in Australian housing policy to date has been in respect of good standard houses to be let at rents within … [Australian citizens’] capacity to pay.
The characterisation of the 1940s Australian housing crisis as a problem of a lack of dwellings, the high costs or ‘affordability’ of housing, and the poor quality of existing housing stock is well documented, as are the policy solutions that were pursued in response to this crisis (Berry; Troy; Macintyre. Missing from such accounts is an in-depth and critical examination of how the 1940s housing crisis was constructed, especially as a series of geographical problems, and how solutions pursued in response to this crisis were justified. Such discrepancies are argued to be a feature of housing histories more generally (Jacobs ; Cole ).” (https://www.tandfonline.com/doi/full/10.1080/00049182.2017.1336968)
Current Housing Crisis Pressures
The current housing affordability crisis for renters and first home buyers is becoming ever more acute following the pandemic. It seems, as if business and Corporate Australia in particular are clawing back any losses and lining the pockets of their investors with record profits. This is happening at the same time that at least a third of working age Australians are struggling to pay the rent and, indeed, find rental accommodation in their neck of the woods.
High inflation and the cost of living index is screwing us all with relentless rises in essentials like rent, food, and energy costs. The market is leading landlords by the nose to raise rents again and again, with rises of 20% to 30% across the board in most cities.
“Australia is experiencing a period of very low rental vacancy rates and rising rent levels, which has led to what is widely recognised as a ‘rental crisis’. Indeed, the national rental vacancy rate (i.e. the percentage of untenanted rental properties against all rental properties) was at 0.9 per cent in September 2022, the lowest since April 2006 (when it was 0.8% for one month). This very low vacancy rate has been sustained for most of 2022, a situation not seen in the last 20 years.”
The Albanese federal government is promising a concerted effort on their behalf and by state governments to address the housing shortage. At the same time they are bringing in record levels of migration, some 1 000 per day. Migration boosts economic growth during this higher interest rate corrective time, even if they have nowhere to live in the short term. Tents are being erected again on the fringes of some cities due to the housing shortage and affordability crisis.
A House Is A Home…
A house is a home but has been a major economic factor in the nation and in the lives of Australians. The poorer members of our communities are suffering unfairly due to the unaffordable expense of keeping a roof over one’s head in the 21C.
We have been hit by a pandemic, floods, and bushfires. Since those recent disasters, we have been mercilessly fleeced by Corporate Australia, the RBA, banks, energy companies, and businesses. Businesses like Qantas are unprepared to wear and share in the hard times with the rest of us it appears.
Record profits are being declared whilst many Australians are seeing their savings and lifestyles go down the gurgler. Building companies are going bust with a dangerous frequency. Everything costs substantially more across the full gamut of services and goods. Qantas, Woolworths, Coles, CBA, NAB, ANZ, Westpac, Ampol, Woodside, Wesfarmers, Suncorp, and Santos all returned super profits.
“Corporate Profits in Australia averaged 56588.40 AUD Million from 1994 until 2023, reaching an all time high of 151403.00 AUD Million in the first quarter of 2023 and a record low of 12032.00 AUD Million in the first quarter of 1995.”
Australia’s housing crisis is not new; indeed, it is a regular occurrence through our history. The wealth of the nation is booming but is in the hands of the few and not the many. The share of the nation’s wealth has shifted away from the majority of Aussies into those with vested interests. This has accelerated over the last couple of decades and been overseen by our governments. Wage growth has stagnated over the same period. The ACCC has failed us, as can be seen by the market concentration levels in almost every sector. Therefore, our governments have failed us on this score because they appoint those in charge of these regulatory bodies and fund them. Corporate Australia can set the prices due to the absence of any real competition. Our leaders have failed the nation and bagged the proceeds for their own benefit. Neoliberalism has been a smokescreen for this, promising cheaper prices via privatization but in reality distributing the wealth of the nation to well placed insider mates at the top. Nobody is ever held to account for these things and white collar crime flourishes in Australia.
Those of us without our snouts in the trough are playing a mug’s game. Now, once again, we cannot afford to live in our own country.
Robert Sudha Hamilton is the author of Money Matters; Navigating Credit, Debt, and Financial Freedom.
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