A sick place’: Chandler-Mather laments parliament after ousting By Daniel Lo Surdo Ousted Greens MP Max Chandler-Mather has called parliament “bloody awful” and a “sick place” in an interview with the ABC on Tuesday evening, days after conceeding defeat in the Brisbane seat of Griffith. Chandler-Mather’s hard-line stance on growing public housing supply drew the ire of the government in the previous parliamentary term, causing the Greens MP to face extensive derision from the rest of the chamber. Anthony Albanese took a thinly veiled swipe at Chandler-Mather and ousted Liberal housing spokesperson Michael Sukkar upon returning to Canberra on Monday, saying that “part of the reason why they’re not in the parliament is that they held up public housing”. Max Chandler-Mather says he won’t miss a workplace where people “come up and just yell at you while you’re trying to give a speech”.Credit: Alex Ellinghausen In his first interview since losing his seat, Chandler-Mather told triple j’s Hack program that while he was “proud of his work” he would not miss parliament, which he described as “bloody awful” and a “sick place”. “We were getting attacked because we said we should spend a bit more on public housing and give something for renters,” Chandler-Mather said. “Can you imagine if you’re in a workplace and you have people in that workplace coming up and just yelling and screaming at you while you’re trying to give a speech … it’s odd.” Chandler-Mather shared optimism for the Greens’ prospects in the new term despite losing his own seat, flagging confidence in the minor party retaining the seats of Melbourne and Ryan, while maintaining considerable influence in the Senate. The Greens also conceded defeat in Brisbane, which was held by Stephen Bates. Sydney Morning Herald
Failing our homeless: Public homes sit empty for years as the State considers whether to keep or sell https://thewest.com.au/business/pro...-considers-whether-to-keep-or-sell-c-18558172 This State Government home in one of Perth’s most exclusive suburbs has been sitting empty for years, with bureaucrats pondering its future while families sleep rough. The Inglewood property is among the thousands of empty public-housing homes prompting questions over the State Government’s management of its property portfolio. The long-term vacant house is among 308 empty social-housing properties which are subject to “further assessment for future use,” while another 1693 sit vacant for renovations. But property advocates and local residents say faster decisions and repairs are desperately needed, with evidence that decisions are — in some cases — taking more than four years. An Inglewood resident complained that the State Government’s failure to either fix or sell the house meant a homeless person, or someone wanting to escape domestic violence, was missing out. 294 Crawford Road Inglewood. “It’s heading to winter and to think a family can’t have this home is heart-breaking,” the resident said. The West Australian initially photographed the Inglewood home in question — which has been deemed unfit for habitation — as a vacant property in September 2023. The Department of Communities confirmed it is still empty, but refused to reveal when it was last occupied by a social-housing tenant. A department spokesman said the house required extensive works before it would be fit to live in and that repairs were difficult in older homes in heritage areas. “The Department of Communities is considering the well-located site for future redevelopment,” a spokesman said. The office of Housing and Works Minister John Carey said the department was also thinking about selling the home. But there was no explanation as to why it had not made a decision either way over the past two years. The Minister’s office did not answer a question about why the Government had not sold the Inglewood property — with land worth an estimated $1.1 million — with the proceeds used to spot purchase other social housing. The spokesman said the State Government was already adding significant one and two-bedroom stock in the Inglewood area. More recently, the State Government had announced a tender for more than 1000 social and affordable homes across the State. While there are no figures on how long social housing properties sit empty for repairs or assessment of future use, housing advocate Dani Summers said a house in her regional hometown Pingelly had been vacant for more than four years, with no signs of a decision. She blamed government neglect for failing to deal with the matter earlier, warning several other vacant government housing properties in the town risked becoming dormant for years. Meanwhile, there was a growing list of vulnerable people who could not afford private rentals. ShelterWA chair Kieran Wong called for speedy action. “With more than 20,000 Western Australian households on the waiting list, we are very concerned that hundreds of social housing properties are sitting vacant whilst decisions about their future are made,” he said. “These homes should either be renovated as promptly as possible or redeveloped to build even more social housing.” A new Anglicare report highlights every that every house is vital, with many welfare-earners forced to live in cars or couch-surf because not even a room in a share-house is affordable on their income. Its research shows only two Perth rentals are affordable for a welfare-earner. There are currently 21,772 applications — which can represent multiple people — on the years-long wait-list for government housing in WA. Opposition housing spokesman David Bolt said it was important to carefully manage existing stock while addressing issues affecting new supply, such as delays in electricity connections which hold up new developments. Mr Bolt said he had spent the morning talking to people who can not get affordable rentals. “Some of these people are on the verge of giving up,” he said.
Gurner warns tenants of 15-year rental crisis ahead Sarah Petty Property Reporter first published at May 13, 2025 https://www.afr.com/property/reside...f-15-year-rental-crisis-ahead-20250512-p5lyjv Tim Gurner has bad news for renters – the housing crisis has another 15 years to run as the nation’s lacklustre supply struggles to meet demand. Rents have soared nearly 40 per cent since 2019, the year before the pandemic. And even though the pace of rental growth is easing, affordability has never been worse. Renters need roughly one-third of their income to cover their obligations. Tim Gurner in his latest build-to-rent project, Madison Grand in Southbank, Melbourne. Eamon Gallagher “Even if the government came out tomorrow and changed all the planning rules, changed all the capital and debt rules, it’s not going to be fixed in three, not fixed in five, seven or 10 [years],” Gurner, one the country’s biggest apartment developers, told The Australian Financial Review. “We have a good five to 15 years’ worth of rental crisis coming where there’s going to be a huge amount of pressure on supply.” The wealthy businessman is known for his luxurious private wellness clubs such as Saint Haven in Collingwood, which offer everything from breathwork classes to cryotherapy sessions, as well as his high-end build-to-sell and built-to-rent developments across the nation. Gurner said his plea for the need to speed the delivery of homes into the market was not about his own business motivations, but a call to solve a national crisis. “If you look at the vacancy rates, it’s pretty simple, right? We have vacancy around 1 per cent in every single state, construction supply is the lowest it’s been in 10 years. “Population growth is higher than it’s ever been. So it’s very simple mathematics to see that we’ve got the biggest undersupply in history with the highest demand in history, with population growth still growing. So it’s got nothing to do with our motivations.” The Albanese government has nailed its colours to its ambition to deliver 1.2 million new homes to the market by the middle of 2029. Analysts say it is an impossible target, and on track to miss by about 400,000 homes. While debate rages over the main cause for the supply squeeze – the planning system, banks, high mortgage costs, Nimbys, migration – Gurner said the biggest problem for developers was high construction costs. Developers will not build if they cannot make a profit. “Us as developers, really, we take a cost base. We put a margin and the cost is what it is,” he said. “It’s never been harder to actually bring supply to the market. “If the government wants to bring in more affordable and more attainable housing, they have to find a way to increase supply which allows us to drop our cost. It’s the only way to do it.” Construction costs had blown out by as much as 100 per cent in some parts of Australia, he said, driven by the price of labour, planning delays and the returns needed to serve equity capital and debt. Worsening affordability Data from housing market analyst Cotality shows rents had risen 39.9 per cent by April since March 2019. The average tenant now pays more than $180 a week more than they did six years ago, equivalent to about $9440 a year. This has led to a rise in share houses, especially in capital cities, amid worsening affordability. On a brighter note, the annual pace of rental growth is now at its slowest since 2021, up just 3.6 per cent nationally in the 12 months to April. Perth experienced the biggest jump at 5.7 per cent, followed by Adelaide (5.5 per cent) and Hobart (5.4 per cent). Cotality research director Tim Lawless said rents had risen “spectacularly” in the past six years, with rental affordability at a record low. “Nationally, renters are dedicating 32.9 per cent of their gross annual income to servicing rent,” he told the Financial Review. “Rental affordability is forcing a structural change to how rental houses are forming. So we’re seeing more group households, renters are probably trying to maximise their tenancies. “Renters have reached a ceiling on how much they can, or how much they’re willing to pay, which is why we’re seeing these other changes.” The drop-off in new housing supply is evident in Australian Bureau of Statistics data. High-density dwellings – apartments – are a key component in boosting supply for rented housing. Although there has been some improvement, approvals of new units were running at just over 15,000 in March, well down on the peak of more than 23,000 in November 2017. “We have a genuine rental crisis that’s not going to be fixed anytime soon.” Gurner said.
Minns’ backyard the worst performer for housing approvals Campbell Kwan Reporter May 15, 2025 https://www.afr.com/property/reside...rformer-for-housing-approvals-20250515-p5lzf1 NSW Premier Chris Minns faces a politically awkward bottleneck in his own electorate, with Georges River Council – which covers large swaths of his seat of Kogarah – being the state’s slowest development approver amid a deepening shortfall in new housing supply. Georges River Council approved just five residential development applications and rejected 116 in the first 10 months of the 2024-25 financial year, translating to the state’s lowest approval rate of just 4 per cent, according to the NSW government’s council performance league table. NSW Premier Chris Minns has previously conceded his state will miss its housing targets. Sam Mooy This is despite a push by the state to roll out a suite of reforms designed to accelerate approvals – such as allowing six- or seven-storey unit blocks around dozens of train stations – and placing more scrutiny on local councils such as a league table to meet its target of building 322,000 new homes over five years. The housing target – 322,000 new homes for NSW and 1.2 million nationally – was a centrepiece of Prime Minister Anthony Albanese’s 2022 federal election victory in convincing voters he could fix the national housing shortage. Falling short in NSW, the largest and most populous state, risks undermining the entire accord, as the national target of 1.2 million new homes relies heavily on the state delivering its share. one of the most important issues nationally among younger voters. Albanese pledged $10 billion to build up to 100,000 homes exclusively available to first home buyers to meet that housing target.
House price explosion coming, says economist History suggests that once the RBA starts cutting, property fever hits quickly. One prominent economist says a 10 to 15 per cent price rise is coming. Michael Read Economics correspondent May 18, 2025 https://www.afr.com/policy/economy/house-price-explosion-coming-says-economist-20241023-p5kkjz Michele Bullock is almost certain to cut the cash rate to 3.85 per cent on Tuesday, and if there’s one thing Australia’s housing market loves, it’s cheaper money. Financial markets aren’t stopping at one. They’re pricing in two more cuts by December – taking the cash rate to 3.35 per cent – and another by mid-2026. History suggests that once rates start falling, property prices don’t wait around. Bank of Queensland chief economist Peter Munckton has crunched four decades of data and says a 10 to 15 per cent price rise over the next two years is a reasonable bet – no matter how many cuts Bullock ends up delivering. “There were smaller price rises in both the early 1980s and 1990s. But on both those occasions, the unemployment rate was above 10 per cent. Currently, the unemployment rate is within touching distance of 50-year lows,” Munckton says. On the flip side, Munckton says the extraordinary 20 per cent-plus gains seen in the ’80s, ’00s and during the pandemic also seem off the cards over the next couple of years. “In the 1980s, house prices were boosted by the greater availability of credit from the deregulation of the financial sector,” he says. “In the 2000s, it was the improved affordability from lower interest rates and the boost to household income from the start of the mining boom.” “And in 2021, it was the historically low level of interest rates, the substantial boost to households’ disposable incomes from government subsidies and the structural shift towards standalone housing caused by the shift to working from home.” Supply pressures bite Peter Tulip, a housing expert at the Centre for Independent Studies and former RBA boffin, says the forces pushing up house prices are stronger than those pushing them down, though he does not expect any dramatic price rises over the next couple of years. Beyond falling interest rates, Tulip notes that rents are rising well above the rate of inflation and vacancy rates are still low. “A tight rental market is symptomatic of demand for housing of all sorts being strong relative to the supply,” Tulip says. “We don’t have a lot of construction coming into the pipeline. Approvals and other measures of construction are relatively low.” Just 180,000 dwellings were approved over the 12 months to March, according to the ABS. While that is higher than the decade-low of 164,000 mid-last year, it is still well beneath the record 243,000 annual approvals recorded during the apartment construction boom in 2016 and not enough to meet the Albanese government’s goal of building 1.2 million new homes by 2029. First home buyer boom? Sticking to the time-honoured tradition of boosting demand rather than fixing supply, Prime Minister Anthony Albanese unveiled a dramatic expansion of first home buyer support ahead of the May 3 election. From January 1, virtually all first home buyers will be able to enter the market with just a 5 per cent deposit, under an overhaul of the Morrison-era scheme that spares buyers from lenders mortgage insurance via a taxpayer-backed guarantee. Albanese has promised to turbocharge the program by scrapping the $125,000 income cap, making it available to an unlimited number of applicants instead of just 35,000 per year, and dramatically raising property price thresholds. A separate promise to build 100,000 new homes was also made – but that extra supply could take years to arrive, if it arrives at all. Economists universally agree the dramatic expansion of the 5 per cent deposit program will raise house prices – the question is by how much. Analysts who predict the effect will be modest say most of the applicants that take advantage of the expanded scheme probably would have bought a house anyway. Tulip says the effect of the policy on price growth would be in the “low single digits”. But he predicts the effect may be more evident in areas where first home buyers tend to buy, such as on the outskirts of big cities. Economists who think the price response will be large say the lure of a 5 per cent deposit could encourage first home buyers to borrow more than they otherwise would. What we know for sure is the expanded scheme will be popular. About one in three first home buyers in 2023-24 accessed the guarantee, according to Housing Australia, and that was with income limits and program caps in place. Where to watch With more buyers set to flood in and not enough homes to meet them, the next question is where the pressure will hit hardest. Since 2020, house prices have grown by 60 per cent – double the rate of apartments – as the rapid shift to working from home boosted demand for larger standalone residences with spare rooms. But with houses now about 30 per cent more expensive than units, Munckton thinks it is unlikely the price of standalone homes can sustainably outperform apartments and townhouses, short of a large decline in interest rates or a big jump in household disposable incomes. Affordability constraints mean capital cities could once again outperform regions. Since the pandemic, regional prices have soared 74 per cent, outstripping capital cities, where values rose 44 per cent. The strong growth means capital city property prices have gone from being about 60 per cent more expensive than the regions to just 35 per cent – close to a 15-year low. Munckton expects growth over the next couple of years to be strongest in Hobart, Darwin, Melbourne and Canberra – the cities where values are historically low compared to their long-run relationship with Sydney house prices. Rate cuts are coming, demand is rising, and supply is lagging – in other words, the more things change, the more Australia’s housing market stays the same.
The fly in the ointment? Investors always take advantage over genuine home buyers driving up prices higher and higher. Higher prices = more government revenue from RE. Never mind productivity falling and population enslavement.
Treasury is addicted to income tax to fund spending Virtually everyone is protected by the government from inflation eroding their real incomes, except the humble wage earner. John Kehoe Economics editor Jun 5, 2024 https://www.afr.com/policy/economy/...o-income-tax-to-fund-spending-20240604-p5jj4w Treasury secretary Steven Kennedy last week argued it would be a bad idea to index income tax thresholds to inflation like other countries because it would add to inflation. That bracket creep helps the budget’s automatic stabilisers restrain inflation by taking money out of people’s pockets is accurate – at least in isolation in the short term. But this reasoning omits several important counterpoints that must not go unremarked. Treasury secretary Steven Kennedy and Treasurer Jim Chalmers. AAP Treasury has become very focused on macroeconomic management but less authoritive on the tax system. Treasury is now a revenue-raising agency, funding undisciplined government spending. Treasury cares less about incentive-sapping tax bracket creep that former secretary Ken Henry has repeatedly warned is contributing to an “intergenerational tragedy” for younger workers. Kennedy told a Senate hearing this week: “I personally don’t see anything fundamentally unsustainable about the Australian tax system.” Contrast this to Henry, who in April warned that “young people have been screwed” by income tax to fund a bigger government. Former Treasury secretary Ken Henry. Andrew Meares “The burden of funding the prospective lift in public spending will have to be shouldered by a declining proportion of the population – principally young workers; the same people who have been priced out of the housing market,” Henry said. “It puts at risk the social compact.” That doesn’t sound very sustainable. Voters appear to agree. Some 41 per cent of Australians disagree with the proposition that the tax system is working well and not requiring substantial reform, according to a poll of 1000 people by JWS Research. Only 23 per cent agree that it is working well and 27 per cent are neutral. The government’s budget asymmetrically taxes and spends. There is automatic increased spending via inflation-linked indexation, but no indexation of income thresholds on the tax scales. Welfare payments, pensions, rent assistance and other government transfers are indexed to inflation. This protects financially vulnerable people, who, we should note, have also recently had additional payments above inflation-linked rises. Treasury indexes other items to inflation, such as the superannuation balance transfer cap that has increased from $1.6 million in 2020-21 to $1.9 million this year. Super balances up to this amount upon a person entering retirement can earn tax-free super earnings forever. More broadly, Labor has overseen a 21 per cent annual rise in the cost of the $44 billion National Disability Insurance Scheme. Bracket creep is being recycled into government spending. The NDIS is the gold standard exhibit A. Yet, we never hear arguments from Canberra that the NDIS spendathon, running at five times the pace of inflation, is inflationary when by definition it obviously is. In this budget world, virtually everyone is protected by Treasury from inflation eroding their real incomes, except the humble wage earner. Bracket creep is where nominal income growth causes individuals to pay higher average income tax rates each year. The historical effective average tax rate in the first two decades of this century was about 23 per cent, according to economic modeller Chris Murphy. Even after the overhyped “stage three”, $23 billion annual income tax cut from July, bracket creep is projected to lift the average tax rate back to 25 per cent by 2028-29. “Without indexation of the tax brackets, a similar-sized ‘tax cut’ would again be needed then to return the proceeds of bracket creep,” Murphy notes in a new analysis. The previous major tax cut was in 2010-11, so taxpayers shouldn’t hold their breath. The government will inflate its way out of spending and debt at the expense of workers through the silent sucking of bracket creep. The tax revenue windfall is likely a factor why Treasury has pushed the Reserve Bank of Australia to tolerate higher inflation and lower unemployment more than other central banks. It makes the job of the accountants at Treasury easier to fund out-of-control spending on the NDIS. Federal government spending in real terms is rising 4.5 per cent this year, even discounting for the high inflation rate. Contrary to Treasurer Jim Chalmers’ big fib that his real spending growth is a “fraction” of former Coalition governments, the 4.5 per cent exceeds any of the five years of the Abbott-Turnbull-Morrison terms before the pandemic. It exceeds real spending growth in nine of the 11 years of the Howard government. Bracket creep paying for NDIS rorts Federal spending as a share of the economy is forecast to hit 26.6 per cent of GDP in 2025-26. Remove the pandemic years and this will be the biggest spending year for a government since the mid-1980s. Get it? Bracket creep is being recycled into government spending. The NDIS is the gold standard exhibit A. The NDIS is a so-called “insurance” scheme, but it has no premiums, no excesses and no self-insurance component – price signals that exist in any other insurance market. It has become an uncapped taxpayer-funded honey pot that is far too big for the government to police. The NDIS integrity chief says nine out of 10 plan managers showed signs of fraud and the justice system would be overwhelmed if all the scams carried out were prosecuted. The uncontrolled outsourcing to external NDIS plan managers happened under the Coalition government. It failed to impose financial controls, minimum standards for invoices and did not require private disability service providers receiving direct payments to register for an Australian Business Number. The rorts have been exacerbated by Bill Shorten creating loose eligibility in the Gillard government, blocking vital cost-saving reforms in opposition and not yet realising savings in two years as NDIS minister. Why is Labor only aiming to contain NDIS cost growth to a still very high 8 per cent a year – triple the inflation target – when the NDIS integrity chief admits there is no hope of prudently governing the existing scheme? The lack of respect in Canberra for hard-working taxpayers is a disgrace. Tax bracket creep is aiding and abetting this scam. It puts less pressure on Shorten and Labor ministers to fix the NDIS. Rather than forcing politicians to explicitly raise revenue more transparently from other tax bases, bracket creep is their hidden get-out-of-jail-free card to silently suck money from workers. Hence, the government relies more on one of the most economically damaging imposts identified by the Henry tax review and doesn’t shift to more efficient tax bases such as consumption, land, passive wealth and carbon emissions. Moreover, rising average tax rates create a disincentive to work in Australia. Experienced economic modellers are convinced that income tax cuts directly reduce wage pressures and hence help lower inflation. Income tax cuts induce slightly more labour supply and are also factored in by workers in wage negotiations. There is empirical evidence of this during the transition to the GST in 2000 and history more generally when large nominal income tax cuts have been implemented. In the minimum and award wage decision this week, Fair Work Commission president Adam Hatcher said: “We have also taken into account that modern award-reliant employees will shortly receive the benefit of the stage three tax cuts and the budget cost-of-living measures, which are projected to increase real household disposable incomes over the next 12 months.” Australia indexed income tax brackets in the 1970s under the Fraser government. Today, seventeen OECD countries automatically adjust their brackets to compensate for higher prices, but Australia is not one of them. Indexing income tax brackets to consumer prices normally does not fully offset bracket creep because wages and average taxable incomes usually grow faster than inflation. Ellis has a big idea Perhaps the best compromise has come from former RBA assistant governor turned Westpac chief economist Luci Ellis. She suggests increasing the income tax thresholds annually in line with the RBA’s 2.5 per cent inflation target. This would partially – not fully – return bracket creep annually, help the central bank manage inflation and take away some of the “political” decisions on tax cuts, Ellis recently said. The modest 2.5 per cent indexing would largely address Kennedy’s “procyclical” inflationary concern of automatically indexing the tax scales to the rate of inflation like other countries. Under the Ellis model, the income scales would not be indexed to higher inflation rates of, say, almost 10 per cent, like in the US during the peak of the inflation spike in 2022. ”The automatic indexation of income tax brackets in the United States has been procyclical with income tax payable as a share of household income declining by around 2 percentage points between June 2022 and December 2023, which compares with an increase of around 1 percentage point in Australia,” Kennedy said last week. Nonetheless, inflation is still slightly lower in the US. Perhaps this is because the RBA hasn’t raised interest rates aggressively and its pact with the Treasury tolerates higher inflation. Steady annual tax relief suggested by Ellis would be less likely to cause the big accumulation of bracket creep over the past decade and the dam wall suddenly bursting. Now, the decade of overtaxing workers will be suddenly reversed from July when $23 billion of nominal income tax cuts flow into the economy. That will add to inflation, instead of a steady drip of annual indexation during high and low inflation periods that would be in sync with the RBA. Alas, Australia will be stuck with bracket creep. Liberals like bracket creep so they can give people a pretend – not real – tax cut before elections. Labor likes hidden bracket creep to fund higher spending.