Where did the Lucky Country Go? Homelessness and Housing Affordability

Guy Johnson, CASR’s Housing and Homelessness Research Program Lead reflects on the housing crisis gripping Australia

Housing affordability now affects a whole range of people that haven’t traditionally been of interest for people like me who have focused on homelessness. Young people, professionals, and older people, women in particular, are now finding themselves excluded from the great Australian dream.

Housing affordability is even having an impact on reasonably well-to-do middle class families who have got a stake in home ownership. They recognise that it probably won’t be possible for their kids to own a home because of rising house prices. They’re realising their kids are being cut out of the housing market, and this is one reason why it has become such a big talking point within the media.

Price Increases

Since 1996 there’s essentially been straight line increases in the housing crisis. Admittedly, there have been a couple of dips but what we’ve observed are sustained and significant house price increases – our housing is now amongst some of the most expensive in the world.

Those that are ‘lucky’ enough to make it in, particularly first time owners are saddled with fearsome amounts of debt. The implications of this aren’t just immediate, but they’re also further on down the track.

More People, More Credit, Less Housing

What has driven this transformation isn’t entirely clear – surging populations, easier access to credit, an obsession with housing as an investment, supply side constraints – are just a few possible reasons. Nonetheless, politicians and policy makers are starting to see that our reliance on home ownership as the primary form of housing is creating a social policy nightmare with far reaching implications.

Pensions, Older People and Homelessness

What a lot of people don’t realise is that how we configure our housing market is also linked to how we configure our welfare regime. In the sense that aged pensions were historically premised on the fact that you had your own housing and you downsize but you could sell it. You had your own housing so you didn’t have to cover your housing costs out of your pension. Now all of a sudden we’ve got increasing numbers of people who can’t cover their housing out of their pension. So you’re looking at a different story altogether and we’ve got an ageing population so all of these things are raising big policy issues.

Social Housing

There are more and more people are calling for an increase in social housing and we’re hearing it from voices who historically haven’t supported social housing. While the call for more social housing is moving out into the broader community, social housing, particularly public housing is strongly stigmatised. But there’s no reason for it to be stigmatised. You look at other countries and it’s not the case at all. In Germany, a powerhouse economy, nearly 40% of their housing is social housing. Social housing is stigmatised here because of the policy settings we have, and the way we locate everyone in similar areas, rather than across different suburbs.

Homelessness is the sharp end of the spear in terms of housing affordability and we will see more people become homeless unless we take action to increase the supply of affordable housing across the country.

Keep your eyes open for the next post in our series on homelessness exploring the difference between the visible homeless, like those on our streets and the invisible homeless who make up the largest population of homeless people.

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