The purpose of this post is to work out who I will vote for in the House of Representatives based solely on the issue of affordable housing for the 2013 Federal Election.

There are 16 candidates standing for the House of Representatives and 97 standing for the Senate in my current electorate of Melbourne.

1

Let’s kick it off with Cath Bowtell from the Australian Labor Party, since I saw a poster of her on the way to work the other night.

There is no mention of affordable housing on her page (www.cathbowtell2013.com has been shutdown as of 14 September 2013 so the link is now to her twitter account).

No matter. If she was elected she would have to follow the Labor party line.

What is the Labor party line on affordable housing?

The closest I can find on their website on affordable housing is this:

“More than 21,000 new homes are being delivered across Australia with Labor’s $6 billion investment in social housing, while the $4.5 billionNational Rental Affordability Scheme has provided incentive payments to the private sector to build 50,000 affordable rental homes.”

Initially the scheme looks good because it is stimulating an increase in the supply of residential housing. All other things being equal, if you increase the supply of a product the supply curve will shift to the right and there will be a new, lower, equilibrium market price.
Now let’s step back and look at the big picture.

Labor is spending a few billion dollars to directly subsidise an increase in the supply of rental accommodation.

At the same time Labor continues to support negative gearing, which is where we allow and encourage all investors to buy houses and apartments that already exist (which does not increase supply) while claiming the mortgage interest and other costs as tax deductions on their normal wages. Negative gearing results in the Government losing billions of dollars in tax collections each year for the benefit of investors speculating on an activity that provides no real value to society (unlike borrowing money to open a new business or a new Aussie startup).

Labor’s plan for housing affordability is therefore to lose billions of dollars a year in tax collections to encourage demand, which increases the price of housing while spending billions of dollars to try and stimulate supply.

The right thing to do is to phase out negative gearing for investors buying residential properties that already exist. Tax collections would increase, you wouldn’t need to waste billions on the NRAS and demand for houses by investors would reduce, with a downward pressure on prices. Since Labor is doing the complete opposite of the right thing on this issue lets just move along.

2

Martin Vrbnjak – Palmer United Party

Didn’t find anything on affordable housing on the policy page.

3

Joyce Mei Lin Khoo – Rise Up Australia Party

As of 25 August 2013 there is no information on the above page, yet there are bios on the many candidates they are running in Vic. Because I can’t find any information about Joyce and there are also no details on the AEC page for the candidate, she is going last on my how to vote card, even though the party has a few good things (indirectly) on affordable housing.

The following is from their 26 policy principles:

(25) To eliminate homelessness and deficiencies in aged-care by a variety of policies, including making low-cost housing more affordable by, inter alia, releasing more residential land, providing more jobs in rural/regional areas, and by substantially assisting the existing support agencies (such as Salvation Army etc) to provide low-cost communal housing and rehabilitation/job-training services;

Releasing more land will help increase supply and will therefore help to put a downward pressure on prices, provided the land is sold directly to people are going to build soon, not hold the land as a speculation for the future.

(5) To protect and enhance the right to private property and private ownership by working towards the dismantling of all unjust taxation, levies, duties, charges and imposts against the family home, family farm and business…

The above is a bit vague and doesn’t also say where the money is going to come from, assuming the intent is to abolish stamp duty taxes, council rates etc etc.

(4) To limit and reduce foreign ownership of our assets (including the media), to repay our foreign debt…

Outlawing the purchase of residential houses by those who are not Australian citizens would help to reduce demand and therefore  price, yet it sounds a little like a passing statement.

4

Nyree Walshe – Animal Justice Party

Nothing about Nyree Walshe on the candidate page for Vic as of 25 August 2013.

Nothing about housing affordability on the policy page.

5

Royston Wilding – Secular Party of Australia

Welfare:

…The Secular Party recognises the crisis in housing affordability. We recognise the need for Government intervention, including the need for the provision of public housing.

What is needed is less government intervention. The problem with our housing market is there is too much interference on both the demand side (negative gearing, foreign buyers, near zero minimum deposit requirements, unrestricted credit growth, stamp duty tax, rent assistance, capital gains tax concessions, increasing population etc) and supply side (restricted supply of land and allowing land released to be held as speculation by developers) which all combine to drive up prices.

More public housing doesn’t even begin to address the problem.

6

James Mangisi – Sex Party

Nothing housing related jumped out at me on the policy page.

7

Paul Cummins – Australian Independents

From the policy page:

Housing Affordability:

  • The Australian Independents are fighting for more public housing.
  • The Australian Independents are committed to addressing the issue of housing affordability.

Without knowing their thoughts on what exactly needs to be addressed to solve the issue of housing affordability I don’t see how I can believe that they are committed to it.

8

Frazer Kirkman – Independent

Running on the Save the Planet platform, which does not cover affordable housing.

9

Josh Davidson – Bullet train for Australia

Only covers the bullet train.

10

Michael Murphy – DLP Democratic Labour

From the housing policy page:

First Home Buyers

To ease the hardships faced by Australians in buying their first home, we propose that first home buyers should be able to access their superannuation funds to fund up to 5% of the total value of the home.

There was the above and a mention of public housing but that is all. I believe home ownership is more important than superannuation, but because the above shows they have no idea what is causing unaffordable housing I will put them lower on the vote list.

11

Adam Bandt – The Greens

There is a page called Better Deal for Renters:

The average Australian rent has tripled in Brisbane, Perth, Darwin and Canberra since 2000; and in every other city has at least doubled in the same period. Currently there are no checks and balances on rent rises – and in any other sector 10% – 50% price inflation, year on year, would not be tolerated. Why should this be the case with our housing?

At first glance it looks like they are starting to touch on the issue. Yet they have gone from saying that rents have at least doubled between 2000 and 2013 to saying in the next sentence that 10-50% price inflation EVERY YEAR would not be tolerated for any other sector (I assume they mean food / healthcare etc).

The Greens’ national standard for renters would look at limiting the number of times rent can be increased, a fair minimum period of notice for a rent increase and by how much, and prescribing a formula linked to general pricing levels, such as the CPI. It could also set clear provisions determining whether an increase is excessive, as is done in the Netherlands.

Here we see that they haven’t got a clue what is CAUSING unaffordable housing, just that they have a belief it is because of greedy landlords and that the only solution is a planned economy whereby huge departments set prices across the country. In Victoria, every rental increase letter I have received has stated that I can apply to some government body for them to independently assess whether the proposed rental increase is excessive or not. Hence we don’t need to even use the example of the Netherlands because we are already doing it, yet it is pointless because they will just say “yes, this is the current market price for this type of rental property”.

Yet the Greens position makes complete sense when we actually look at their housing page. There is nothing I can see there that will address the economic causes of our unaffordable housing. Principle 4 shows us the world-view that causes the communist angle on housing:

Governments should provide sufficient public and community housing to meet current need and projected demand.

12

Noelle Walker – Family First

They seem to be having a clear go at addressing the supply side problem. This is the first of their five points on what needs to be done:

Where they have been applied, urban growth boundaries or zoning restrictions on the urban fringes of our cities need to be removed. Residential development on the urban fringe needs to be made a “permitted use.” In other words, there should be no zoning restrictions in turning rural fringe land into residential land.

While I don’t agree and neither would most communities that it should be completely de-restricted, it does show they are serious at looking at the supply side issue.

13

Sean Armistad – Liberal

Nothing.

14

Kate Borland – Independent

From her facebook page above:

“…it is the politicians who have not predicted the need to build more public housing and BUILT it or the astronomical housing cost in Australia and sought to scrap negative gearing so that private rental and home ownership become a thing of the past”

I have little doubt she would support the removal of negative gearing if given the chance so she is a contender.

15

Michael Bayliss – Stable Population Party

From their policy page:

1. Limit government birth payments to each woman’s first two children

  • This law would apply only to births occurring more than nine months after it was passed.
  • It covers the birth payment via the Family Tax Benefit A* and paid parental leave.
  • We do not support restrictions on family size – we simply support the withdrawal of government incentives to have large families.

2. Adopt a balanced migration program, where permanent immigration is equivalent to permanent emigration

  • This is also known as ‘zero net migration’ (the world average).

  • This would reduce annual permanent immigration from around 250,000 (including NZ) to around 80,000, and include flexible skilled, family reunion and humanitarian (refugee) components.

The above would have a significant impact on reducing demand on housing and therefore price. If we have net immigration then we should allow the supply of available housing land/apartments to match that demand but we don’t so prices increase.

16

Anthony Main – Socialist Party Australia

From the policy page:

Housing

Affordable housing for all as a basic right.
Expand and improve public housing to wipe out the waiting lists and create construction jobs and apprenticeships.
Legislation to cap private rents at 20% of income and ensure that landlords provide quality, safe accommodation.
No to the privatization of public housing. Defend and extend public housing parks, playgrounds and services.
Put an end to gambling on the housing market. End all forms of property speculation.

No mention of how property speculation will be stopped so I will ignore that point. Public housing is a band aid solution that costs taxpayers yet does not address the cause of the problem. It’s all well and good to say that affordable housing is a right, yet the reality is that houses cost money and someone has to pay for them. The first question is whether the market will be able to operate to satisfy most peoples need for accommodation. I believe that if the market was allowed to operate properly (without all the interference on the demand side to increase prices and the restrictions on the supply side that increase prices) then we would have much more affordable housing which makes the public housing less relevant. Affordable housing for all is a goal, a very important national goal that all of us share, yet it is not a right. We are all free to go and buy a tent for $100 and sleep in the park if we want to. No one is pointing a gun to our heads saying we have to have air-conditioning, LED TV and a dishwasher, that is all our choice.

So that’s it. Time to make a list of who is doing their best to fumble with the housing affordability button.

1 Michael Bayliss – Stable Population Party

2 Noelle Walker – Family First

3 Kate Borland – Independent

4 Michael Murphy – DLP Democratic Labour

5 Royston Wilding – Secular Party of Australia

6 Paul Cummins – Australian Independents

7 Josh Davidson – Bullet train for Australia

8 James Mangisi – Sex Party

9 Martin Vrbnjk – Palmer United Party

10 Frazer Kirkman – Independent

11 Anthony Main – Socialist Party Australia

12 Nyree Walshe – Animal Justice Party

13 Sean Armistaed – Liberal

14 Adam Bandt – Greens

15 Cath Bowtell – Labor

16 Joyce Mei Lin Khoo – Rise Up Australia Party

federal election vote for affordable housing in Melbourne

@TaxpayersParty

Disclaimer:

  1. It may appear from the above that I do not support public housing. My current view is that it is very important for people that are homeless or have just become homeless and that if the housing market was operating as an actual market then someone on a very low income would be able to step up and off short term homeless accommodation into the rental market where they still have access to public transport etc. If they can’t do that then the market is failing. If they need rent assistance to do it, or family tax benefit payments to do it, then the housing market is failing. There are positive things happening though 🙂
  2. I didn’t use any other criteria such as sustainability/ethics etc. Some of the parties have certain policies that would be quite damaging to the economy and I chose to completely ignore that here. Hopefully at the next federal election the housing policies will be better and then I can look at other factors too.