Australia needs a housing summit, like we need a World Cup victory

12/10/2011 10:01 am

Pascoe’s article “Housing affordability: the summit we really need” couldn’t have come at a better time. The problems are there, the weaknesses noticeable, the remedies we are unsure of (hence the summit) but we are trying; much like Australia’s current Rugby World Cup campaign.

Lets not beat about the bush, a fundamental change is necessary. For the housing market, as Pascoe points out, its critical, things are starting to get out of hand with housing affordability, a crisis of confidence if you will. The last time the wallabies held the Bill high above their heads was 1999 and things were significantly different.  Median price for a first home was $185,250. Come 2010, the median house price was $487,200. Yes, yes CPI and the rest of it, but you have to admit, a bit of a problem has arisen, where salaries aren’t really helping the Australian dream of owning “your own bit of paradise”.

Now for a look at the Wallabies. They were on the top of the world, literally, John Eales was at the helm and Rod Macqueen was looking on, putting the lads through their paces and ensuring that victory followed persistence.

12 years later, it is a very different story. The Wallabies have suffered their own confidence crisis, to solve this, they have tried numerous line ups, not to mention captains and coaches, but seem to have finally hit the mark with the right combination (except for Ireland, yikes).  Pascoe’s argument is based around the need of a “summit” to fix the crisis of housing affordability...I wonder how many “summits” the Wallabies have had in the last 12 years to solve their crises? ? Developers have been pleading with government for over 10 years  but unfortunately it has fallen on deaf ears.

Stockland CEO, Matthew Quinn sees local councils as the major problem to providing more housing, “(Local councils) use planning reasons and planning justification for that when in fact that is nothing to do with it, it’s actually fear of other people coming into the neighbourhood in smaller houses that might change the tone, which is absurd and selfish,”. Mr Quinn told The Australian

Pascoe goes on to say, what is needed is for local governments and the state governments to sit down and work out the problem, for example, why low income earners are being housed on the outskirts of the city...Great point!! To think about it in Rugby terms, it would be like putting the forwards in the backline and making the backline scrum down, that’s neither economical nor efficient and has huge ramifications, both economically and socially. You don’t need statistics to tell you that large amounts of people not working, therefore not spending, is not good for your economy. Just like switching players on a rugby pitch can make the team a weaker unit.

The technical issue of taxation review (getting rid of stamp duty and introducing a land tax) decreases the purchase price, but doesn’t solve the problem.  A total reappraisal of the system is necessary, if it is going to facilitate a stronger economy, just like the Wallabies have undertaken since build a stronger team.

Like the coaching staff of the Wallabies, the local governments and state governments, need to reset the boundaries and find the right mark, to tackle the issue within their respective councils. Address the issue head on, find the weaknesses, promote growth and good ideas! Who knows they might even solve the crisis of housing affordability. Just like the Wallabies might hoist up the Webb Ellis once more. But on both fronts, given the lack of a Summit specifically about this issue occurring anytime soon and the Wallabies playing at Eden Park this weekend, like Michael Pascoe...I won’t hold my breath.

Forever the optimist that I am, Go the Wallabies!

Henry Otton is CFO and sometime blogger of Blockbrief. He finds pleasure in drawing comparisons between the goings on in property and the real life issues and assembling them in a way that readers may find factual. At the very least, he hopes they are entertaining.