AU Housing Policies Play Favouritism, Some Groups Sure Winners

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Prior to the eighties, the government’s approach to the housing system was to help more people gain access to it. However, that all changed when the interest of the select few was prioritised.

According to Alison Pennington, a senior economist for the Centre for Future Work and contributing writer on ABC, “from the 1980s, Australia’s housing system was being transformed into a “closed shop “,” working on expanding the wealth of existing homeowners and investors. If you owned a home, you had a membership to Australia’s exclusive wealth-builders’ club.”

She added that changes to the housing policies favoured the homeowners. Generous tax concessions were implemented, allowing these people to pay significantly lower taxes. Then the government unburdened itself with the labour of developing new residences for private companies.

This caused a massive drop in supply while its demand kept rising, leading to hefty price hikes so the younger generations could no longer afford it. Only the older, wealthier generations can afford to own and maintain houses.

Max Chandler-Mather, The Greens’ housing spokesperson, notes, “the higher interest rates go, the more negative gearing will cost the budget, which means right at the time when the government needs extra revenue to help alleviate the cost-of-living crisis, they are instead handing it over in the form of tax concessions to wealthy property investors.”

Dan Ziffer, a business reporter for ABC, notes that Australia’s tax and welfare perks are designed for older Australians to benefit. According to his report, wage growth has remained low for younger Australians, who also are the same group of people not enjoying tax advantages.

Sadly, the younger generations are ‘locked out’ from the housing system filled with older landlords. Moreover, with the rate of wages failing to catch up to the interest rates of mortgages, many abandon all hopes and dreams of owning houses.

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