Australia’s housing crisis has become a fierce political battle that could have major implications for the next federal election

Australia’s housing crisis has become a fierce political battle that could have major implications for the next federal election
  • PublishedMarch 25, 2024

A fierce battle over housing is set to intensify and define the next federal election as Labor, the Coalition and the Greens target a growing cohort of voters who believe they’ve been locked out of home ownership for life.

The great Australian dream of owning your own home has been fading for a long time — there’s nothing new about this. But the crisis is now baked in — and it has arguably become the big generational disrupter, changing votes and threatening to hurt the government at the next poll.

The Greens have successfully put housing on the mainstream political radar. Now the Liberal Party — who are strategising about how they can become relevant and attractive to the younger voters they’ve been losing in swathes — are joining the debate after privately acknowledging they’ve been missing in action on this pivotal issue.

In the middle stands the Albanese government. Burnt and scarred by their crazy-brave promise to reform negative gearing in 2019 — partly leading to them losing that election — they have been running from any suggestion that they might again look at contentious changes to tax on property ownership.

Labor insiders privately acknowledge they are getting politically smashed on housing, with various solutions being floated internally to address it.

There is also deep frustration that they are not getting adequate credit for the suite of policies they have already announced: There are 17 policies in total and $26 billion in new funding to address Australia’s housing crisis.

Labor has argued that the answer to this problem is supply, supply and more supply. But supply isn’t materialising fast enough and migration numbers are putting further strain on the market.

A massive headache for the government

Some Labor insiders tell me they believe there needs to be a shake-up — even a reshuffle — to ensure the role of housing minister is held by one of their best communicators. Housing Minister Julie Collins has one of the lower public profiles in the government and has been out-manoeuvred by Greens housing spokesperson Max Chandler-Mather who has, to the constant irritation of the government, seized the territory on this lighting rod issue.

Several of Collins’s colleagues have described her as a solid minister; some also say she is having little cut-through where it matters most. But most concede the government needs to take collective responsibility for the housing crisis and debate — and the looming budget in May provides a key opportunity.

Still, the reset on this issue will need to run deeper than communication.

Collins gestures with one hand while speaking at the despatch box in the House of Representatives.
Housing Minister Julie Collins’s colleagues have described her as a solid minister.(ABC News: Adam Kennedy)

Labor has several housing policies — including its help-to-buy scheme designed to assist 10,000 homebuyers a year through shared equity. It is currently stuck in parliament because the Coalition and Greens aren’t backing it.

“We know we’ve got a lot of work to do,” Collins told Sky News at the weekend. “Obviously having the Liberals voting against more housing in the parliament is very unhelpful, and what I would say to the Liberals is they should be supporting housing measures in the parliament instead of voting against them at every opportunity.”

This week the combination of high migration figures and news that new housing construction is falling behind schedule triggered a massive headache for the government and delivered and the opposition a strong attack line.

The government is working with states and territories to meet the housing accord target of 1.2 million homes in five years, but the building industry is raising concerns about its capacity to deliver, with a construction worker shortage and state infrastructure projects hoovering up workers. While the government is offering state and local councils $3.5 billion to fast-track construction, some are worried that the target starting in a few months won’t be met.

Where’s the Coalition?

In Question Time, Shadow Treasurer Angus Taylor asked why Australia’s adult population had increased by over 1 million people since the Albanese government had taken office, while home building completions were only a quarter of that figure.

It cut deep. NDIS and Government Services Minister Bill Shorten — who is known for calling a spade a spade — said there was a “crisis out there” in how to balance immigration and housing.

The government announced it would begin enforcing tougher visa rules for foreign students starting this weekend, with increased English language requirements for student and graduate visas. The government will also get the power to suspend education providers from recruiting international students if they repeatedly break rules.

“The reality is, though, that there is a crisis out there in terms of how we make sure we balance immigration and housing,” Shorten said.

A man wearing a suit and glasses
Andrew Bragg was announced as the shadow assistant minister for home ownership in Peter Dutton’s March reshuffle.

Coalition figures privately admit they’ve been too slow to respond to this issue. Given the housing crisis has become a barbecue-stopper conversation, it is surprising that the Coalition has taken so long to develop targeted policies to address it.

They are now trying to sharpen their focus with Peter Dutton’s announcement of Andrew Bragg as the shadow assistant minister for home ownership in the March reshuffle.

Bragg has since floated the idea that home owners should be able to pay their super into their mortgage offset accounts — in an attempt to expand the Coalition’s housing policy, announced by Scott Morrison in 2022, to allow first home buyers to use their super to purchase property.

Bragg now says he will push for first home buyers to be able to withdraw more than the $50,000 proposed before the 2022 election. While he dismisses the criticism by some experts that this would only increase house prices, Liberals are not all convinced the policy has mainstream appeal, with some holding concerns about it being painted as a raid on young people’s super — a claim they contest. Many believe the party needs to be looking for other policy responses.

‘Who do we fight for?’

Menzies MP Keith Wolahan believes the revival of a shattered Liberal Party relies on boosting home ownership. He is one of a handful of Coalition MPs who are prepared to go where so many fear going – putting the tax treatment of houses as an investment tool on the table for debate.

His leader Peter Dutton hasn’t been prepared to go there. But Wolahan, a millennial, says the crisis needs a fundamental rethink.

“The disconnect between average wages and median house prices risks killing the Australian dream,” he tells me. “Success in life will become less about hard work and more about the lottery of birth or ‘marrying well’. Our children should study the works of Jane Austen; not be forced to live them.”

A man in a suit gestures while talking.
Liberal MP Keith Wolahan says the housing crisis needs a fundamental rethink.

Governments need to answer this question, he says: “Is the residential property market just another investment class? If their answer is an unqualified ‘yes’, then we will speak only of supply and say nothing of quality and distribution. We will supercharge high-density build-to-rent [properties] over family-friendly build-to-own [homes].”

Conversely, Wolahan says: “If we are serious about home ownership and aspiration, we will pursue policies that both boost supply and tip the hand of first home buyers over investors. Right now, there is an imbalance the other way, particularly for established stock. This invites a political question: who do we fight for?”

That question is one that the big parties will need to grapple with if they hope to sway younger voters.

Demography is destiny. And the demography freight train is coming for both parties.

I want to leave you with a quote from the Australian Election Study’s analysis of the 2022 election, which puts this conundrum in stark terms:

“How the Coalition addresses this overwhelming deficit of support among younger generations is perhaps the single biggest question confronting Australian politics.”


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