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WE had affordable housing from the 1950s to the 1980s in Canberra and elsewhere in Australia.
This was achieved by the then Federal government providing affordable land sold, in many cases, over the counter.
Since then land has steadily become more unaffordable.
In the ACT, housing unaffordability is a self-inflicted problem and there are two reasons for this. Firstly, we had a Federal government overseeing public housing in the ACT and, secondly, there was a provision for over-the-counter sales of blocks.
At the moment land developed by private firms is predominantly sold by auction. This plus the fact that land is artificially kept on short supply means that competitive bidding has driven up the price of land sharply.
The ACT government, because of light rail in particular, can’t afford to ensure affordable housing. It needs the high land prices and the high rates that follow to stay in the black as far as the Budget goes.
There is no way any low-income, prospective home buyers could have an affordable home using ACT government schemes. The accepted definition of an affordable home is one that costs around one third of a person’s income.
With self government, the housing market started to change for the worse. The concept of having a large public housing mix in the ACT took a battering. Both the Labor and Liberal Parties were determined to reduce the 13,500 public housing dwellings by selling off as much as they could and since then the public housing stock has dropped to around 10,000 units.
Since 1995, the criteria for applying for a public housing unit has been tightened with wait times blowing out from just inside three years to five. And the proportion of homeless people has risen roughly by the amount of public housing sold off. To any logical mind the result is a condemnation of the ACT government.
Since 1995 we have gone from having a low proportion of homeless people to having the second highest proportion in any Australian city. The auction system – where developers can outbid new entrants to the housing market – has seen the cost of housing more than triple over 20 years. This has created a situation where you cannot reduce the price of land without financially hurting people who have bought houses at the current price.
Howard Carew has owned a printing business for 30 of the years he has been in Canberra. Since semi-retirement he has been active in community affairs.