from The Guardian.
Wages have not kept pace with the increasing cost of housing – but if you’re looking for someone to blame for our housing shortage, look no further than our political class
Housing affordability is one of the most important issue for voters this Australian election. Problem is, the major parties don’t want to talk about it.
According to Auspoll, 84% of Australians believe housing affordability is an important issue, compared with 68% who want cheap high performance broadband. But in spite of voters wishes for greater housing affordability, the issue is kept it off the media agenda. Why? Because the housing shortage was created by our political class.
In 1967, the average annual income was $2,964 and the median house price in Melbourne was $9,400; the income to house price ratio was 3.2 to 1. Contrast this with 2010 where the annual income was $51,610 and the median house price in Melbourne was $555,000; the income to house price ratio was 10.8 to 1. Is it any surprise we’re complaining?
Wages have not kept pace with the increasing cost of housing. We have been in a period of wage stagnation since the 1980s. Real wages under Labor declined by 1.53% from 1983 to 1992. That certainly has not helped affordability for the working classes. Wages turn out to be the thing that buys goods, so if wages decline, the only way to overcome the problem of real demand is to increase the credit economy – as is reflected in the explosion of household debt from 1987.
There is also an intergenerational dimension. Unemployment for those who are aged 15 to 19 and are not in schooling is at 25.1%; there are few unskilled jobs openings. Other segments of Gen Y do not have it any easier. 1 in 5 people aged 15 to 24 in Melbourne’s west are looking for jobs that aren’t there. Furthermore, 24% of undergraduates cannot find jobs after they graduate. The unavailability of entry level jobs makes it difficult for a Gen Y to get a foothold in the housing market. This is the first generation to never have a growth of public housing in their time.
Nor is it easier for those who receive some form of government assistance. Students at universities are expected to pay a ridiculous amount on rent while studying full time. The ANU has allowed a private company, UniLodge, to use its land to build accommodation for 1,500 students, charging them $238 a week in rent. UniLodge was funded through the Labor government’s National Rental Affordability Scheme. Youth Allowance is only $407.50 a fortnight.
finally, there are also more than 105,000 people who are officially homeless in Australia – which is the most extreme measure of the lack of housing.
Government policies of both political parties have left us in this mess. The astronomical housing prices are caused by a lack of supply of housing. We know we had a significantly more affordable housing 40 odd years ago. But how did the shortage appear? And who does the shortage benefit?
You can blame the government for refusing to play an active role in the provision of housing. Between 1996 and 2007, the number of public housing shrank by 32,000 while the population grew by 2.8 million. There are 173,000 people on public housing waiting lists. Only 5% of Australian housing is public, compared to 20% in the UK.
Most the public housing we have was built between 1945 and 1980 when the Commonwealth State Housing Agreement provided Commonwealth funds for returned soldiers, war widows, new migrants and other locals. This kept housing prices around that 3 to 1 income to house price ratio. The agreement ended in 1996 under John Howard.
When governments stopped funding, new social housing prices exploded. This was exacerbated by privatisation of housing stock held by state departments by both Labor and Liberal governments. Both sides of politics have since the 1980s slashed housing budgets and sold off property.
Furthermore, both parties have held off from releasing land, creating a shortage. This decreases supply and increases prices. Those who benefit from the higher real estate prices are the banks that finance mortgages with larger premiums higher interest rates over a longer period of time, and developers who enjoy much larger profits.
The policies which are claimed to make housing more affordable – like the first home buyers grant – do nothing but enter more people into mortgage. The grant shrinks the deposit gap, allowing more people to access mortgage to enter the housing market. This encourages banks to loan to customers who would otherwise not be able to afford a loan greater amounts of money in the bank’s pecuniary interest. This binds workers to a ridiculously high debt.
It is a helpful reminder than the two major parties’ pay masters have a say in the matter of keeping Australians hocked up to their eyes with debt. In 2011-12, banks donated $1,702,536 and property developers $513,113. This is compared to unions at $200,000.
Who do you think has the ear of power?
from The Brisbane Times.
The state government is set to dispose of more than 200 properties in its social housing portfolio.
The properties, a mixture of houses and blocks of land, have been put up for sale across the state, and include homes in Logan, Monto, Thursday Island, Morayfield and Stafford.
Currently, 22,000 households are on the waiting list for state housing in Queensland.
The government said the sale was part of a regular assessment of “its stock portfolio and property realignment” and was part of the housing department’s “strategic asset management process”.
The opposition, however, has accused the government of a “cynical cash grab”.
Leader Annastacia Palaszczuk said the government was “constantly attacking working class families” at the same time its ministers and the premier were “lining their pockets with appalling pay increases”.
From the Socialist Party’s Hands Off Melbourne’s Estates (HOME) campaign news:
After beating back the governments plans to build private apartments on our open space at Fitzroy and Richmond the campaign has now turned its attention to Prahran where the government has said that that are still going ahead. HOME activists have done some street stalls in Prahran and put up some posters around the estate in the past couple of weeks. So far we have made a few contacts with residents there but we need to get in touch with more. We want to call a meeting in Prahran but we need help with jobs like letterboxing the towers. If you or someone you know lives on the estate, and can help please, let us know or come to our meeting this week.
Committee meeting this Thursday
We will be discussing how to further our work at Prahran as well as elsewhere at the HOME campaign committee meeting this Thursday May 2 at 6pm in the community rooms under 140 Brunswick St in Fitzroy. Anyone who wants to help with our work is invited to attend. If you have any queries feel to email back here or call 96399111.
THE STATE Government has scrapped its ban on political meetings on housing estates after the threat of legal proceedings.
But the DHS spokeswoman Ruth Ward confirmed the guidelines were now being revised.
“In the interim, there is nothing restricting external parties from holding meetings in community facilities on estates,’’ Ms Ward said.
Ms Ward did not specify whether the government would remove bans on doorknocking and messages on notice boards.
The reversal comes after the the Human Rights Law Centre took action on behalf of two tenants of the Fitzroy Housing Estate.
Law centre executive director Hugh de Kretser wrote to the DHS and Housing Minister Wendy Lovell saying the bans unlawfully limited human rights.
“There is a strong case that aspects of the policies breach residents’ rights to freedom of expression and peaceful assembly which are protected under Victoria’s Human Rights Charter,’’ Mr de Kretser said in a statement.
Socialist Yarra councillor Stephen Jolly welcomed the revision of the rules, which he said were brought in following a successful community campaign against development of private housing on Richmond and Fitzroy Housing Estates.
“This was an outrageous attempt to stifle political dissent. We need a Minister who will work with tenants to improve public housing, not work against them,’’ Cr Jolly said.
State Labor member for Richmond Richard Wynne has also been a strident critic of the ban.
From the Daily Telegraph
Under the crackdown, which began last month, door-knocking public housing tenants has also been forbidden.
Yesterday, staff from the Brotherhood of St Laurence, which manages access to meeting rooms at several inner-city housing estates, were forced to cancel a meeting in Fitzroy at which State Opposition Leader Daniel Andrews was to address residents.
The ban was made on the orders of the Department of Human Services under new rules that came into effect last month.
Yarra Councillor Stephen Jolly, who has spearheaded a campaign against a state government push for private development on public housing estates, also has had meetings cancelled at a Fitzroy estate.
Opposition Housing spokesman and former housing minister Richard Wynne fell foul of the crackdown last month, when he was banned from door-knocking an estate in Richmond.
Mr Wynne’s office, which had booked the April 24 meeting at which Mr Andrews was to speak, was yesterday told by email the meeting was cancelled “due to a policy update just received from the Office of Housing, which states that political candidates, parties or representatives are not able to book facilities on the estates”.
Cr Jolly described the ban as “Stalinist”, saying the Office of Housing was acting “more like prison warders than landlords”.
“Why should public housing tenants have fewer rights than the rest of us?” he said.
“It’s like North Korea – it’s restricted democracy. Where is it going to end? Are they going to tell them what TV stations they are going to watch?”
Office of Housing spokeswoman Ruth Ward said access for members of political parties to open-space areas or foyers on high-rise public housing estates has been restricted for some years, though she acknowledged “this guideline has not been consistently applied in the past, and this current revision and reinforcement is the Department’s effort to rectify this”.
But Mr Wynne said any suggestion the ban had been place for several years was “completely false”.
The ban has also been questioned by Brotherhood of St Laurence chief Tony Nicholson, who said he would be seeking clarification of the rules from the Department.
From The Age
A coalition of powerful building unions will launch a campaign urging the Napthine government to build more public housing to reduce waiting lists and create jobs.
The group, which includes the CFMEU and ETU, is preparing a submission for Premier Denis Napthine that outlines unused government-owned sites in inner-city Melbourne that could be transformed into public housing.
CFMEU state secretary John Setka said the campaign would tap into community concerns about public housing waiting lists, a slump in construction and derelict ”bomb sites” across Melbourne.
”It creates a lot of work for construction workers, it gets the economy going a bit and it reduces the public housing crisis,” he said. ”It’s a win-win situation for everyone.”
At least three government-owned sites including the former Gas and Fuel Corporation site at the corner of Smith Street and Alexandra Parade, a large block that houses the Kangan TAFE in Cremorne and land at the back of Richmond Town Hall, have been identified by the unions as potential locations.
”You can understand a government being reluctant if they have to go in and spend $20 million on a parcel of land and then another $20 million – but this is a situation where you they already have land, and in some situations buildings,” Mr Setka said.
Trades Hall secretary Brian Boyd said unions would make public housing ”a big issue” in the lead up to next year’s state election.
”All our anecdotal information suggests our public housing stock is not matching demand,” he said.
”The other issue we have associated with this is the bomb sites around the place – some are good locations for public housing.”
He said the unions were seeking advice from architects and engineers and would present the state government with a formal cas.
”We have had a bit of a slump in the building industry because the state government has not been generating infrastructure. Rather than being negative about it, we thought we could identify these sites as potential locations for public housing developments.”
Last month, the state government backed away from a contentious plan to overhaul Fitzroy and Richmond public housing estates and introduce an equal mix of public and private developments. This followed fierce opposition from the community and Yarra council.
Housing Minister Wendy Lovell said delaying the plans – which must be completed as part of Commonwealth state agreement – would let the government focus on a master plan for Horace Petty Estate in Prahran where there has been less community opposition.
The number of households on Victoria public housing waiting list increased by 685 to more than 37,000 in the December 2012 quarter.