There is nothing better than living in your own home. Even with a mortgage, being able to be the king or queen of one’s own castle is part of Australian culture. And even the movie The Castle set aside Australia’s traditionally left-leaning film tropes for long enough to promote the idea of property rights.
The Greens want to take all of that away.
When it comes to policy, we have been fortunate so far that the Greens are all lollipops and rainbows. Otherwise, they would have us all crammed into government-owned, six-storey, walk-up, high-density flats where we hire electric scooters to ride to our government-appointed jobs.
For now, the Greens can roll out any old policy idea they want because they will not get to implement it. They won’t be (nor do they want to be) accountable for the outcomes of their policies. At the moment, they are clearly focused on obtaining votes from young renters while talking down the prospect of anyone owning their own home.
And they are blaming ‘big banks and wealthy property investors’ for the housing crisis.
The Greens’ solution to the housing crisis is to:
‘…freeze rent increases, build more public housing and end unfair tax handouts for big property investors.’
In the mid-1990s, I had to turn myself inside out to build a modest three-bedroom brick-veneer home in Brisbane’s north. I recall crumping the numbers on the family budget. We were $7,000 short for the year and while most of it is a blur, we worked extra jobs and somehow survived.
Then the government bought the five-bedroom house next to us and it became a housing commission home. A house I couldn’t afford became government housing. To this day I can’t work that out.
Then the Greens have come along with their mythical policy ideas and somehow argued that government control of all things housing will fix the crisis. Not one mention that the cost-of-living crisis that is crippling everyone is caused by the Labor government.
As I have argued elsewhere, and the RBA Governor agrees, inflation is the real problem with the economy. This is being fuelled by government spending.
And don’t get me started on ‘negative gearing’. As my old accountant boss used to say, spending a dollar to save fifty cents is pretty stupid.
The idea of negative gearing is to borrow against an investment property to reduce the tax paid from one’s salary. It works best for those on high-paying salaries to reduce taxable income. An investment property is purchased, then it is rented out, but the rent does not cover the interest and operating expenses. This creates a loss that then reduces the individual’s taxable income and provides a larger tax refund. But you still had to spend one dollar to get back fifty cents.
Not to mention that negatively geared investment properties are usually purchased using an interest-only loan and investor interest rates are almost always higher than owner-occupier rates. And when the property is sold, capital gains tax is paid on any gain made (taking into account other factors and discounts). It remains a high-risk growth strategy unless you are pretty clever.
Negative gearing has become a straw man for the Greens’ policy. Taking away the principle of reducing one’s taxable income by an allowable deduction goes against the principles of our already burdensome tax system.
If you want to know how ridiculously stupid the views are about negative gearing, just tweet something about it to a Greens politician and watch the ignorance roll on in.
Next is the idea of rent caps. We have a market economy. When we don’t have a bunch of socialists running the show, it works quite well. Remember less than three years ago when we had a Coalition government? Even with that ridiculously on the nose Prime Minister? When you could actually afford things?
We are all going broke now because of Labor’s spending. Even left-leaning ratings agencies are recording swings against the Labor government as the cost-of-living crisis really bites.
With each passing month, another layer of paint peels off Federal Labor, as thousands of Australians slip from positive to negative cash flow. Even a drop in interest rates won’t provide much relief, as many households have already drained their savings over the past two years.… pic.twitter.com/B2lHTswPNW
— Kos Samaras (@KosSamaras) September 15, 2024
But the Greens somehow think that the government should build more housing. As history proves again and again, governments suck at doing anything the market can do better. As of June 2024, for example, the Albanese government had spent $30 million on its housing policy without building a single home.
Further, last week it was reported that the Albanese government’s $32 billion housing fund is $3 billion in yet no houses have been built.
Echoing the Greens’ policy, Climate 200-funded Senator David Pocock reckons the government should be ‘pulling every available policy lever’ to solve the housing crisis.
We need a bigger conversation about housing affordability.
We need tax reform, ⬆️ direct govt investment & more but we’re in a crisis – govt needs to be pulling every available policy lever they can.
HAFF is a good start – we need to make it even bigger.https://t.co/5pUZ7GF36Y
— David Pocock (@DavidPocock) September 16, 2024
Perhaps Albo should be laying off the immigration lever if housing is such a problem…
The debate about housing affordability echoes the cognitive dissonance experienced in the current fiscal versus monetary policy debacle.
If the government ever gets around to building more houses, these will take ages to be built by the highest bidder and inflation will increase. Then the RBA will need to put up interest rates to curb inflation, and housing will even become more unaffordable.
And then if the Greens get their way, and negative gearing is removed and rent caps are put in place, then nobody in their right mind would bother investing in the housing market.
And then government will need to build more houses. But the only way to plaster over the economic problems will be to increase immigration, and the cycle repeats ad nauseum.
And then no Aussie battler will ever own their own home.
Finally, there are some who support the Minns’ NSW Labor government’s idea of pattern book six-storey flats. Pattern book houses were the mainstay of the ubiquitous ‘Queenslander’ but these were for standalone houses. The approach in Sydney is to replicate Albo’s childhood story with affordable government housing.
It has attracted a bunch of architectural firms to put forward their ideas.
There’s one key problem and it can be discovered in Albo’s childhood street.
Albo’s childhood neighbour and small businessman, Bart Faddoul, said of Albo and Labor’s economic policies:
‘I’m not a Labor supporter but I’m happy for him. I couldn’t vote for him – I’m a Liberal. Labor economic policy is a mess – you increase the minimum wage, you’ll increase inflation and no one will be able to afford anything… You add $10 a week to the wage packet and you’ll get hit by an extra $40 a week at the supermarket checkout till. It’s nonsense.’
Therein lies the problem. We wouldn’t be in a housing crisis if the economy and immigration had been managed well.
The solutions touted by the Greens may be fanciful but with Labor now on the nose with struggling voters, we can expect some concessions from Labor to win Greens’ preferences that will only push the dream of owning one’s own home out of reach for even more Australians.
The Greens’ solution to the home-grown housing problem is to move us ever closer to socialism and to take away our property rights.
Mark my words. The Greens want us to have less and be happy. And if we give Labor another three years, the Green’s dream will become our reality.
Dr Michael de Percy @FlaneurPolitiq is a political scientist and political commentator. He is a Fellow of the Royal Society of Arts, a Chartered Fellow of the Chartered Institute of Logistics and Transport (CILTA), and a Member of the Royal Society of NSW. He is National Vice President of the Telecommunications Association, Chairman of the ACT and Southern NSW Chapter of CILTA, and a member of the Australian Nuclear Association. Michael is a graduate of the Royal Military College, Duntroon and was appointed to the College of Experts at the Australian Research Council in 2022. All opinions in this article are the author’s own and are not intended to reflect the views of any other person or organisation.
