Andrew Brown analyses how successive Australian governments turned shelter into a casino. This is Part One of three-part series Australia’s Housing Casino.
Australia halved its public housing in a generation and handed the young a voucher instead. The fix is a public builder, a 10 per cent target and a national summit.
For thirty years Australia stopped building homes the way it builds hospitals and roads, and left shelter to a market that now prices a median home at 8.4 times a median income.
In 1991, public and community housing was home to 7.1 per cent of households. Today it is 4. The answer is a public builder: government owned homes at cost rents, open to nurses and young families as well as people in crisis, lifted to at least 10 per cent of households, and a National Public Housing Summit to sign the deal.
Suppose the Commonwealth announced tomorrow that it was getting out of hospitals. Every patient would get a voucher and private operators would auction the beds. Anyone can see what happens next. The price of a bed rises by about the value of the voucher.
The queues get longer. Thirty years on, someone in a suit calls it a supply problem.
No government would dare. We did it to housing.
We turned shelter into a casino, handed the young a few chips and told them to play against the house.
How the game is going
Here is how the game is going. In 2025 a household on the median income needed 11.2 years to save a 20 per cent deposit. A new mortgage swallowed 45.9 per cent of median household income. A newly advertised rent took a record 33.1 per cent. Those are national figures from the National Housing Supply and Affordability Council, the government’s own adviser.
Nothing matters more to the economy than this and nothing does more social damage. Pull almost any problem in the country and housing is on the other end of the string.
Start with the family. The young couple priced out of the suburb they grew up in move an hour away, so the grandparents cannot mind the kids and the childcare bill arrives instead. Adult children stay in their childhood bedroom into their thirties, or move back into it.
Australian researchers have found that when house prices rise, renters who already have a child are less likely to plan another, so
the housing market is now setting the size of the next generation.
Couples stay in bad marriages because two households cost more than one. The woman with a violent partner faces a worse choice, because the alternative to his house is her car.
Economic impacts
Then the economy. A nurse who cannot afford to live near the hospital either commutes two hours a day or quits, and the roster gaps tell you which. The Reserve Bank’s own research finds that a big mortgage makes a household cut its spending on everything else, money the corner shop and the local tradie never see.
Workers cannot move to where the jobs are. And a growing share of Australians will retire still renting or still owing, on a pension never designed to pay a landlord.
So how did housing fall off the list of things governments build? Quietly.
From 1945 to 1970 governments built 16 per cent of the nation’s new homes. From the mid 1990s it was 3 per cent, on the Australia Institute’s figures. In 1982 Canberra abolished its Department of Housing and Construction and passed the remnants to Social Security.
Housing had been infrastructure. Now it was welfare.
The vouchers, now the super raid
The money went the same way. Capital grants to the states withered and the funds were poured into Commonwealth Rent Assistance, which is the voucher. It helps tenants pay private landlords and it has never laid a brick.
Every fix since has been another voucher,
and now the Coalition wants to raid superannuation for the next one. It went to the last two elections promising to let first home buyers pull $50,000 out of super for a deposit, and last week Andrew Bragg, the shadow housing minister, floated a wider version in which retirement savings become collateral for a bigger mortgage.
Modelling for the Super Members Council found the withdrawal scheme alone would lift house prices by 7.4 to 10.3 per cent. New Zealand tried it and home ownership among the under 30s fell seven points. That is not housing policy. It is the casino offering credit at the table.
I do not blame developers. I blame governments that handed an essential service to a profit seeking industry and then took its cheques. Property was the biggest business donor to the major parties over two decades, the Centre for Public Integrity found: $37.4 million to Labor and $53.1 million to the Coalition.
The bill has landed on the young.
At ages 25 to 39, 65.8 per cent of Baby Boomers owned a home. For Millennials it is 54.6, says the Bureau of Statistics. The Bank of Mum and Dad now decides who gets in, and it only lends to its own children.
Blaming it on immigrants
When a full time job no longer buys a home, people stop believing the deal is fair, and that anger goes looking for someone to blame.
More than half the country now tells the Scanlon Foundation survey that immigration is too high. People who cannot find a rental are being invited to blame the family that arrived last year. They should blame the homes that were never built.
What is missing is a public builder. That takes a National Public Housing Summit, every level of government at the table and ministers with the spine to say no to the property lobby.
Private developers can keep building for profit. They will simply have to compete with someone who is building for people.
Next in Australia’s housing casino: how Vienna, Singapore and Robert Menzies did it.
Gen Z super worry? Eleven million dollar houses coming your way
Andrew Brown is a Sydney businessman in the health products sector, former Deputy Mayor of Mosman and Palestine peace activist