More Federal and State Government blame-shifting as they try to avoid the real question of who is really responsible for the ultra-high home prices in Australia.
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High prices are a function of limited supply and extravagant specifications.
1 Developers and project builders currently cater for the upper half of income earners.
2 To cater for the lower half of income earners the home needs to be 2 by 1 rather than 4 by 2. In Australia the average house has just 2.4 persons in residence.
3 Modular building in factories and transportability to sites that are rented rather than purchased would dramatically lower the upfront cost. This form of construction needs less site preparation. Looking forward, it can free up the land for other uses (attracting a higher return) because the current use is determined by the length of the lease, its not forever.
4 Use lower cost land on the outer margin and reduce the level of servicing provided by the state. Allow rural landowners to provide the services required on land zoned rural.
5 Ultimately the price of the house on land zoned ‘residential’ is a product of the supply of land and house under that zoning. Along with the zoning comes expectations related to the size of the house, type of material used in its construction, the size of the block and the standard of servicing that is desired. That is the a matter of convenience and profitability to suit the players involved namely, utility providers, developers, planners and builders. Planners condition the supply by limiting heights and densities, forbidding the construction of housing outside the area zoned for that purpose and imposing conditions on planners in the name of social responsibility and according to their sense of aesthetics.
6 Abolish zoning and allow people to build what wherever and whatever they desire and the problem would disappear.
7 Debt financing suits risk takers expecting inflationary gains requiring scarcity. Flood the market and the gamblers will disappear.
8. Long mortgages and extreme debt levels lock people into persisting to pay and hoping for a price that is greater than was paid, or just the recovery of the original (inflated) outlay. This is bad news for people, the society and the economy. If income can not be sustained to meet the mortgage the penalty can be severe.