The Housing Australia Future Fund (HAFF), Labor’s flagship policy to address the housing crisis, described by Housing Minister Julie Collins as “life-changing legislation that will help generations of Australians”, has not resulted in a single home being built in the nearly two years since it was passed. This was revealed in Senate Estimates Committee hearings in February, when Labor’s Finance Minister Katy Gallagher tried to claim that the HAFF had “completed” 340 new homes (already a derisory number). She was quickly forced to admit that these were existing properties that had been acquired. 
From the beginning, the HAFF was a fig leaf to hide Labor’s inaction on the housing crisis. What was touted as a $10 billion boost to housing was actually an investment fund, with the money gambled on the stock market and a maximum of $500 million in returns to be spent on housing each year. Labor claimed the HAFF would build 30,000 “social” and “affordable” houses over five years, but <a href="https://www.crikey.com.au/2023/05/19/housing-australia-future-fund-10-billion-welfare/">reporting by Crikey</a> showed that it would construct around 14,000 properties at best. With 122,000 people homeless, 172,000 on the social housing waitlists and thousands more people being pushed into housing insecurity each year, the HAFF was only ever going to help a tiny number of people to afford a home.
Two years on and the HAFF hasn’t helped anyone. Anglicare’s 2025 Rental Affordability Snapshot reported that affordability has crashed to record lows. Buying a home is more out of reach than ever: you’d need an income of more than $275,000 a year to get a mortgage for a median-priced house in Sydney, according to a SQM Research report. As this article is being written, Queensland police are <a href="https://www.theguardian.com/australia-news/2025/may/08/police-rangers-and-excavators-move-in-to-brisbane-parks-as-tent-city-residents-face-eviction">clearing a “tent city”</a> of the homeless in Brisbane’s Musgrave Park. Where these people are supposed to go is anyone’s guess. 
The Liberals have blamed the HAFF’s failure on government bureaucracy and red tape, but this is cynical rubbish coming from a party whose idea of “red tape” is a planning control requiring windows in an apartment or paying construction workers the minimum wage. The Liberals’ real objection to the HAFF is that they don’t think the government should even pretend to be building affordable housing. They’d prefer to dispense with the fig leaf and openly shovel public money into the pockets of the developers and let the market rip. 
The HAFF hasn’t resulted in any properties being built because almost none of the money was ever intended to go directly into the construction of affordable homes. The HAFF is a <a href="https://www.housingaustralia.gov.auhttps://cms.redflag.org.au/sites/default/files/2024-01/HAFFF%20NHAF%20Fact%20Sheet%20-%20Developers%2C%20Builders%2C%20Financiers%20and%20Investors.pdf">financial instrument</a> that gives concessional loans and subsidies to private developers who partner with community housing providers. In other words, it’s a handout to big corporations, which can get cheaper debt to build for-profit developments in return for providing a small number of “social” or “affordable” properties. The government has no control over when the homes are built, or whether they are built at all. Instead, it’s up to developers, whose sole concern is maximising their profits. If the market looks good, then maybe they’ll build, but if not, they’ll wait and build nothing, as we’ve seen for the past two years. 
The HAFF is a failure. If the government’s priority was building affordable homes rather than underwriting corporate profits, there are straightforward measures it could implement now to tackle the crisis. It could spend $10 billion (or more) directly on housing, rather than gambling it on the stock market and drip-feeding the returns. It could establish a public builder to construct new homes, rather than holding itself hostage to the market and developers’ profits. And it could keep the properties as public housing, not hand them off as “social housing” to external providers. 
In the wake of Labor’s election win, Albanese has told the Greens and anyone who cares about housing justice to “get out of our way on housing”. Get out of the way so Labor can do what? Introduce more policies like the HAFF that can’t get a single property built? Give more cash handouts to developers like Build to Rent? Tout more token measures like Help to Buy that drive up house prices? We shouldn’t get out of the way; we should get in the way and fight a Labor government that has made the housing crisis worse.

Martin Barker

A HAFF is not a home

If you have been following the commercial press, you would think that the Labor government is trying to fix the housing crisis. Headlines such as “Why this is the housing fight that Albanese had to have” and “Bulldozer PM blasts Senate in election clash on housing” in the Sydney Morning Herald were prompted by parliament blocking two bills that Labor says are “critical” to addressing the housing crisis. 
The Help to Buy scheme promises to assist up to 10,000 households a year to buy a house through a shared equity scheme, in which the government provides 30 to 40 percent of the purchase price. In a press release promoting the bill, Minister for Housing Julie Collins said, “Right across the country Help to Buy will be life-changing, bringing home ownership back into reach for thousands of Australians, particularly renters”. But the scheme is tiny and at best would help only 0.2 percent of renters or 8 percent of the estimated 120,000 first-home buyers each year. 
Government measures like these also push up house prices. The existing First Home Buyers Grant, which gives eligible purchasers $10,000 towards the price of their first property, is estimated by Deakin University academics to have increased the median price of a house by more than $57,000 between 2002 and 2012. The Grattan Institute has said that the effect of Help to Buy on house prices will be only a marginal 0.016 percent. But as economist Saul Eslake told SBS News: “The fact that it’s only a small percentage is a reflection of the fact that this scheme isn’t going to help many people”.
Far from being “life-changing” for renters, Labor’s flagship housing bill is a tiny drop in a vast ocean of housing unaffordability. It’s a scheme so insignificant that it will help only a tiny number of people buy a house, and so market oriented that if it did help more people, it would make housing more, not less, expensive. 
Labor’s other measure, the Build to Rent bill, is a handout to property developers wanting to cash in on the lucrative rental market. It offers tax concessions to multibillion-dollar companies like Mirvac and Meriton to build apartments that will be rented out at market rates. In return, developers must designate just 10 percent of apartments as “affordable housing”. The meaning of “affordable” is stretched to breaking point at 75 percent of market rents, which would be $558 a week if based on the median rent in Sydney—that’s 42 percent of the median weekly income. 
In case even that is too much of a drain on developer profits, they will have to keep the apartments “affordable” only for fifteen years, after which they can charge however much they want. A similar scheme, Kevin Rudd’s National Rental Affordability Scheme (NRAS), gave developers $11,000 for every $4,000 in “reduced” rents. The Grattan Institute estimates that one third of the $3 billion of public money spent on the scheme went to developers as windfall profits. Like the NRAS, Labor’s Build to Rent bill is a public subsidy for developers that will only increase rents, not lower them. 
Two reports released this week highlight the depth of the crisis that these schemes will fail to address. PropTrack data on the housing market reported in the Guardian showed that only 13 percent of homes across the country are affordable for a household with a median income, down from 40 percent only three years ago and the lowest share since records began in 1995. For those on low incomes, there is no prospect of being able to buy a home, an estimated 20 percent of Australian households being shut out of the housing market entirely. 
The Everybody’s Home campaign’s “Priced Out” report confirmed the dire situation for renters. Record rents, combined with stagnant wages and benefits payments, mean that those on the age pension would be left with just $8 a day if paying the median rent, while those on the minimum wage would be giving 68 percent of their income to a landlord. 
So far, the Greens have blocked Labor’s housing bills in the Senate and demanded that the government introduce rent caps and reduce tax breaks for investors. In response, Prime Minister Anthony Albanese has painted the Greens as “unreasonable” populists who are letting “the perfect be the enemy of the good” and siding with the Liberals to form a “No-alition” (yes, Albanese’s rhetoric really is that bad) of the “extreme right” and “extreme left” to stop young people buying a house. The government has even threatened an early election if these policies are not passed.
But the Greens were right to block the bills, and they should continue to refuse to pass them. Labor’s Help to Buy and Build to Rent are not small steps towards fixing the housing crisis, they are backward steps that hide Labor’s inaction, put more money in developers’ pockets and do nothing to help the millions struggling to pay for their homes.

Labor’s housing bills do nothing to fix the crisis

When the Reserve Bank announced its latest decision not to cut interest rates, governor Michelle Bullock told homeowners struggling to pay their mortgages that “some may ultimately make the difficult decision to sell their homes”. Three weeks earlier, the Commonwealth Bank announced profits of $9.1 billion for 2023-24. This is the housing crisis in 2024. Millions of households are struggling to pay rising rents and mortgage repayments, while profits soar for the banks and wealthy landlords.
This dire situation for workers, students and the poor can seem uncontrollable, the result of market forces that we have no power to shape. But here are five things we could do to fix the housing crisis now. 
1. End tax concessions to investors
The federal budget is estimated to lose $165 billion over the next ten years in tax concessions to investors. The negative gearing and capital gains tax exemptions subsidise rich landlords by allowing them to write off interest payments and agent fees from their income tax and walk away with tax-free profits when they sell. 
When interest rates rise, a working-class family that owns only their own home bears the full cost of increased mortgage payments, while the government gives rich investors a subsidy by allowing them to claim the increased payments off their income tax. The tax concessions also drive up house prices by helping wealthy investors to outbid those trying to buy a home to live in. This entrenches the power of a tiny section of society whose main interest is for house prices to rise as high as possible so they can make a bigger profit when they sell. 
Ending the tax concessions to wealthy landlords wouldn’t cost a cent; instead, it would mean billions of extra dollars that could be used to build housing and result in cheaper house prices overall.
2. Freeze and cap rents
More than 30 percent of Australian households now rent, and an increasing number of people have no prospect of ever buying a home. Renters are at the mercy of price-gouging landlords who have increased prices to record levels over the past three years. The median price in Sydney is now $750 a week, up more than 11 percent in a year, and there are no properties in the entire country that are affordable for a person on Newstart or the Disability Support Pension. 
Instead of letting landlords fleece more money from people’s need for a home, the government could intervene to freeze rents for two years and limit future rent increases. This has been done before, when the federal government introduced rent and eviction controls during the Second World War. And such measures are popular, with 60 percent of people surveyed by the Guardian
in 2023 supporting a rent freeze. 
3. Build public housing
Over the past 40 years, governments across Australia, both Labor and Liberal, have gutted public housing. Years of underfunding and sell-offs have reduced public housing to only 4.2 percent of all housing stock, while the number of people urgently needing this housing has increased by 50 percent in just the past three years. There are hundreds of thousands of people on waiting lists across the country who face a ten or twenty-year wait for a property.
Building the 950,000 properties that the City Futures Research Centre estimates are required to satisfy demand would also put downward pressure on rents generally, as hundreds of thousands of tenants exited the private rental market. It would also be a step towards asserting that the government has a responsibility to meet people’s most basic needs and weaken the dominance of the market and profits as the sole determinants of whether a person has a home to live in. 
This would cost a lot, hundreds of billions of dollars, but the money is there. For instance, ending Labor’s commitment to building nuclear submarines would free up an estimated $500 billion, more than enough to build all the needed homes.
4. Seize the empty homes
A recent survey by Prosper Australia estimates that in Melbourne alone, there are 100,000 empty or underused properties, enough to house those on the public housing waiting list in Victoria twice over. It is a scandal that amid a housing crisis, wealthy investors can let homes sit empty, waiting for house prices to go up while people sleep on the street. But this is the madness of allowing the market and profit to determine whether people have a home, instead of building and distributing housing based on people’s needs. 
The only concern for rich property owners is how much money they can make, not whether the property gets used for its obvious purpose—to provide shelter. If investors can buy low and sell high, why deal with the inconvenience and expense of making the property liveable or dealing with tenants who cause wear and tear to their asset? These empty properties should be taken from the wealthy and used to house those living on the streets, or at the very least they should be taxed so much that they are forced either to rent or to sell the property. 
5. Build a fight to end the crisis
Albanese is not going to fix the housing crisis, nor are the state Labor governments, and appealing to them to do the right thing won’t get us anywhere. They are impervious to moral or rational arguments. The suffering of families living in their cars, parents skipping meals so they can make rent or mortgage payments, or thousands living on the streets has done nothing to tweak their consciences. The politicians won’t listen because they are there to protect the power and profits of the people they truly represent, the developers, the banks and the rich, not to ensure that government provides for people’s needs. 
Fixing the housing crisis would mean taking on the power of big business and the rich. We need to force the government to act, whether they want to or not. We can’t rely on a clever negotiating strategy or having the balance of power in parliament; we already saw that didn’t work when the Greens capitulated and passed the Housing Australia Future Fund, despite not having won any substantial changes to a policy that will not fix the crisis. 
Instead, we should look to what has worked in the past: the eviction riots of the 1930s that brought workers and the unemployed together to fight the landlords and their bailiffs; the Builders Labourers Federation in the 1970s, militant workers who used the power of the strike to protect working-class housing.
They showed that workers, students and the poor can challenge the power of the developers, the landlords and the politicians who do their bidding. We should take inspiration from their struggles when thinking about the kind of movement needed to end the housing crisis today.

Five things to fix the housing crisis

We are in the midst of a housing crisis. One obvious way to alleviate this would be to build hundreds of thousands of public housing properties. But the state and federal Labor governments have refused to do this. Instead, they are offering tax cuts for the rich and handouts to private developers.
When the government does say it will fund the construction of new homes, such as those under the <a>inadequate</a> Housing Australia Future Fund, it still doesn’t commit to building public housing; instead it offers “social housing”. 
What is this? Social housing is not synonymous with public housing. It’s an umbrella term that includes both public and community housing. 
Public housing refers to properties that are built by the government and then managed by its own relevant department. Community housing is owned and/or managed by not-for-profit, non-government organisations (NGOs). Much of it is built with public money and then handed over to these private providers. It is promoted as being just like public housing, but more “flexible” and “responsive” to tenants. That is just spin. Compared to public housing tenants, community housing tenants often have fewer rights, higher rents and more difficulty in challenging decisions made by their housing providers.
And these NGOs are mostly not “community” organisations, but <a>big companies</a> that, while they might not pay dividends to shareholders, are run like any other business. A <a>survey</a> of community housing executives conducted by the Australian Housing &amp; Urban Research Institute in 2017 made clear that profit and efficiency are the priorities for the sector. One CEO respondent said: “For me [social enterprise] is an alien term. We’re a ‘profit-for-purpose’ company”. The Community Housing Industry Association’s 2021 <a>report</a> boasts of a 15 percent revenue surplus, $15 billion in assets and $11 billion in net equity for the sector. 
The rise of social housing represents government abandoning its responsibility for ensuring people have affordable homes. It continues the shift towards the market under way in other areas of essential social support, like disability and aged care.
That <a>shift</a> started in the United Kingdom under the Thatcher government in the 1980s and was part of the neoliberal assault on public services that soon spread across the world. Governments became “purchasers” of social housing services, and lower-income tenants became “consumers” who were supposedly to choose between housing providers as they would between brands of biscuits. 
In Australia, the shift towards social housing started later but is gaining pace. In NSW, community housing now accounts for more than one-third of social housing stock, and across Australia it is <a>around 25 percent</a>. In 2017, the NSW government <a>forcibly transferred</a> 14,000 public housing properties to community housing providers, having changed the law so they no longer had to get the public housing tenants’ consent (so much for consumer choice). 
The other new housing scam is the rise of “affordable housing”. Don’t be fooled by the name: affordable housing is nothing of the kind. “Affordable” properties are rented out to people on low-to-medium-incomes at a discount (usually set at 20–25 percent below the market rate). The problem with this is fairly obvious—if the median rental price for a unit in Sydney is $670 a week, shaving 20 percent off is still unaffordable for people on the minimum, or even median, wage. With the current pace of rent hikes, what the government considers affordable today are the utterly unaffordable rates of just a year ago. 
The tenants have no security of tenure, while the developers who build these units get planning concessions, and the investors who buy in get tax breaks. On top of all that, most affordable housing programs require the properties to be rented at a discount only for a limited time, usually ten years, after which the owner can charge whatever they want. 
In NSW, the Minns Labor government has instructed its departments to find whatever “spare” public land they can in inner-city suburbs (including land currently occupied by public housing), which they will then hand over to private developers. Only 30 percent of units in each new build must be categorised as affordable housing in order for developers to access the land. Regardless, rents set at 85 percent of current inner-city prices would cripple low-income earners. 
The public housing sector is in crisis. Reduced government funding and sell-offs are shrinking the number of public housing properties while the need for them is growing. The properties that remain are often in an appalling state of disrepair, and tenants are commonly treated by housing departments with contempt and disrespect. 
The state is a terrible landlord, but the solution is not social housing, privatisation and further moves towards the market. Instead, the government should properly fund a public system that provides people with the good quality and secure homes that they need.

We need public housing, not social housing

“I don’t get people stopping me in the streets and complaining that the value of their house has gone up”—so said then Prime Minister John Howard in 2003, when asked about house prices that had jumped <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/residential-property-price-indexes-eight-capital-cities">109 percent</a> since 1995. Howard’s implication was that all homeowners were benefiting from the increasing cost of housing, with “ordinary mums and dads” living in properties that had made them millionaires. 
If that was true then, it should be even more the case today. According to data from the Australian Bureau of Statistics (ABS), house prices in Australia have increased <a href="https://www.abs.gov.au/statistics/economy/price-indexes-and-inflation/residential-property-price-indexes-eight-capital-cities">412 percent</a> over the past 25 years. The 2023 edition of the Demographia International Housing Affordability report found that we now have the third <a href="http://www.demographia.com/dhi.pdf">most expensive</a> market in the world. 
Take <a href="https://www.savings.com.au/home-loans/australian-house-prices-over-the-last-50-years-a-retrospective#:~:text=From%201970-2020%20in%20inflation%20adjusted%20dollars&amp;text=In%202020%2C%20the%20average%20house,houses%20in%20inflation%20adjusted%20dollars.">Sydney</a> as an example. The average cost of a house there went from $211,000 in 1970 to $1.1 million in 2020 (adjusted for inflation), or from 4.5 times the average annual wage to over 12. There was a dip in prices as interest rate rises started to bite in late 2022, but they are going up again, with Sydney prices increasing <a href="https://www.abc.net.au/news/2023-06-01/property-price-rebound-gathering-pace-proptrack-corelogic/102415292">4.8 percent</a> from January to May this year. According to ABS <a href="https://www.abs.gov.au/statistics/economy/finance/household-income-and-wealth-australia/latest-release">data</a> for the 2019-20 financial year, homes make up the single largest portion of household wealth, at 40 percent, with superannuation second at 18 percent. 
Going by those figures, Australian homeowners have never had it so good. But a <a href="https://www.smh.com.au/politics/federal/house-prices-may-be-down-but-our-anxiety-about-them-isn-t-20230224-p5cngs.html">survey</a> conducted in 2021 showed that more than 70 percent of Australians were either “worried” or “very worried” about the current housing market, and 92 percent agreed that property prices were unaffordable. That we can have record prices coupled with such high levels of anxiety raises the question, who is really benefiting from rising house prices? 
The short answer is: it’s split along class lines. On one side, constituting the majority, is the mass of mostly working-class households that own a single property that they live in. On the other side is the relatively small number of wealthy households that own two or more properties, along with major housing industry players like the big banks and property developers. As we’ll see, it’s not working-class households that are doing well out of Australia’s unaffordable housing market, it’s the rich. 
In the post-World War Two decades, home ownership in Australia reached 70 percent, having been made a focus of government policy and being subsidised under Liberal Prime Minister Robert Menzies. 
That policy changed in response to the economic downturn of the 1970s. As profit rates fell, government spending was cut back, budgets for public housing were slashed, and access to housing was left to an increasingly deregulated market. Under the Labor government in the late 1980s, tax concessions and low interest rates sparked a rush towards speculation in the property market by the rich and upper middle class. That rush became a stampede under the Howard government in the late 1990s, as further discounts on capital gains tax made property even more lucrative for investors and house prices rose sharply. 
Though the increase in house values has been driven by government policies in the interests of capital and the wealthy few, there are now many working-class households that own properties worth over a million dollars, so haven’t they benefited from the extraordinary price increases? 
It seems intuitive that they would have. The most obvious counter point, though, is that if the value of your house has gone up by 50 percent, then so has the house next door and all the other houses in the market. Given you need somewhere to live, if you own only one property, there’s no real benefit in being able to sell your house for more money if the house you are going to buy has gone up by the same amount. 
At the same time, a smaller number of people own their homes outright—<a href="https://www.aihw.gov.au/reports/australias-welfare/home-ownership-and-housing-tenure">down</a>, according to the Australian Institute of Health and Welfare, a federal government agency, from 42 percent in 1996 to 31 percent in 2021—and the number of people owning with a mortgage rising to 35 percent. Most people can buy only with a mortgage, so higher prices mean more debt and the insecurity of interest rate changes. Figures from the Bank of International Settlements show Australia has the second highest household <a href="https://www.theguardian.com/australia-news/2022/may/05/laden-with-world-beating-debt-australian-households-are-at-increased-risk-as-rates-rise-expert-says">debt</a> in the world, and the <a href="https://www.abs.gov.au/statistics/economy/finance/lending-indicators/latest-release">average mortgage</a> needed to buy a house sits at $584,000, according to the most recent data from the ABS—up 20 percent on pre-pandemic levels. 
Modelling by the Australian National University’s Centre for Social Research and Methods shows mortgage costs as a share of income are now at their <a href="https://www.macrobusiness.com.au/2023/06/double-dip-correction-predicted-for-aussie-house-prices/">highest</a> level since records began in 1984, and the average mortgage holder pays 25 percent of their disposable income towards debt. The burden is much greater for low-income households, which lose more than <a href="https://www.macrobusiness.com.au/2023/06/double-dip-correction-predicted-for-aussie-house-prices/">50 percent</a> of their income to mortgage repayments. 
Even before the latest rate increase, research by Roy Morgan found that more than 1.2 million <a href="https://www.roymorgan.com/findings/9189-mortgage-stress-risk-february-2023">households</a> were at risk of mortgage stress. That number is likely to balloon as 800,000 households come off fixed interest rates on 1 July. Suburbs like Lakemba and Fairfield in Sydney and Flemington and Caulfield in Melbourne are estimated by financial advisory company Otivo to have mortgage stress rates of over <a href="https://7news.com.au/news/report-reveals-australian-suburbs-under-most-mortgage-stress-c-9699039">50 percent</a>. 
One thing that could be seen as a benefit for working-class people is the capacity to pass down high-value properties to their kids, or to assist them in gaining a foothold in the property market. But to the extent that passing on a property brings any benefit, it would be the same whether average house prices were $100,000 or $1 million. 
It’s arguably a worse situation overall when house prices are higher, because working-class homeowners are increasingly forced to assist their children financially, who are otherwise shut out of the market. <a href="https://www.smh.com.au/money/planning-and-budgeting/parents-cough-up-record-100-000-to-help-children-buy-first-home-20220408-p5abza.html">Data </a>compiled in 2022 by Digital Finance Analytics, a consultancy, showed that 60 percent of first homebuyers needed assistance from their parents to fund a deposit for a loan, the amount needed increasing 10 percent from the year before. Is it really such a “benefit” to be able to use money that could alternatively have helped fund a more comfortable retirement to help your kids make the deposit on a huge mortgage that they will be burdened with for decades? A real benefit to working-class households would be their children being able to afford a home without needing this kind of assistance from their parents.
The reality, then, of increasing house prices is that they leave working-class homeowners treading water at best, and the working class as a whole significantly worse off.
It’s a very different story, though, on the other side of the class divide—like the <a href="https://documents.parliament.qld.gov.au/com/CSSC-0A12/HLAB2021-37A9/tp-20july21-2.pdf">15 percent</a> of Australian households that, according to research published in the journal Housing Studies in 2019, own one or more investment properties. These are not the “mum and dad investors” of political myth. They are largely high-wealth and high-income households, surgeons, barristers and accountants being the professions most likely to count among property investors. The ownership of property within this group is highly concentrated, too, among the wealthiest few. The majority of investment properties are held by a minority who own two or more, and recent data from the Australian Taxation Office, reported in the <a href="https://www.theguardian.com/australia-news/2023/jun/04/a-quarter-of-australias-property-investments-held-by-1-of-taxpayers-data-reveals">Guardian</a>, shows that just 1 percent of taxpayers (7 percent of property investors) own more than 25 percent of all investments.
The benefit of rapidly rising house values to this group is obvious. They are able to sell their properties at an increased price, and the negative gearing and capital gains tax concessions available to them mean big returns on their investment. As landlords they can also make money from rent and, unlike households that live in the one property they own, can easily manage higher interest rates by simply passing on the cost to tenants.
Included among the small number of wealthy investors getting rich from higher house prices and rents are many federal Labor MPs, over half of whom, according to a list compiled by Crikey, <a href="https://www.crikey.com.au/2022/09/07/politicians-houses-list-how-many-properties-do-they-own/">own</a> one or more investment properties. Anthony Albanese owns two, Tony Burke owns four (plus another two he lives in) as does backbencher Michelle Ananda-Rajah (seven if you include those owned by her partner). While they’re offering very little in the way of funds to fix the housing crisis, the property investors who make up the majority of federal Labor MPs recently endorsed a budget that continues tax concessions for landlords like themselves worth more, according to <a href="https://www.afr.com/policy/economy/landlord-tax-breaks-to-exceed-100b-20230228-p5co3u">Treasury department figures</a>, than $100 billion over the next four years.
Another tiny section of society that’s doing well from unaffordable house prices is banks, which currently hold an extraordinary <a href="https://www.reuters.com/business/finance/commonwealth-bank-australia-third-quarter-profit-rises-8-2023-05-08/#:~:text=CBA%20dominates%20Australia's%20A$2,19%20pandemic%20to%20early%202022.">$2 trillion</a> in mortgages. Higher house prices have forced households to borrow more and more to purchase a home, and this has meant huge profits for the banking sector. The recent rises in interest rates have supercharged those already big profits: the “big four” banks made <a href="https://www.pwc.com.au/media/2023/pwc-major-banks-analysis-half-year-may-2023.html">a record</a> $17.1 billion profit in just the first half of the 2022-23 financial year. 
Finally, there are the property developers—massive companies like Meriton, owned by billionaire Harry Triguboff, who recently asked of a Sydney council opposed to his proposed 800-apartment development “Who are they to stop me?”. Big developers have made <a href="https://www.commercialrealestate.com.au/news/lendlease-takes-top-gong-meriton-makes-most-profit-in-ibisworld-top-1000-36065/">billions</a> from building low-quality, high-priced houses and apartments. In 2019 alone, Meriton made $1.9 billion while rival developer Mirvac posted profits of just over $1 billion. As a group, developers have consistently lobbied against policies that would lower house prices—like removing tax concessions or building public housing—and instead focused on cutting planning regulations and other forms of “red tape” they see as hindering their profit-making potential.
The huge investment in property speculation over the past 30 years has pushed prices ever higher and delivered massive profits to banks, developers and other major industry players and increasing wealth to the richest section of society. The party can go on only so long, however. Continually rising prices have been fuelled by cheap credit, but as we’re seeing today, that credit won’t stay cheap forever. If prices fall and debts are called in, the market can plummet.
Is that when workers will finally see some benefit? Unfortunately not—the bust that must eventually follow the boom is perhaps the most important reason that working-class homeowners do not benefit from higher house prices. It’s not the rich, after all, who will bear the brunt of any crash, but working-class people who, in the worst-case scenario, will stand to lose their homes and livelihoods. We have seen what happened in the US during the Global Financial Crisis of 2008-09—ten million people losing their homes while the banks and the rich were bailed out with public money. Were a similar crisis to break out today, we should expect to see this phenomenon of “socialism for the rich and capitalism for the poor” repeated.

Property profiteers: who benefits from the housing crisis?

There are two sides of the housing crisis in Australia.
On one side are the rich. Over the next four years, the federal Labor government is going to give $100 billion to wealthy investors. The money will be handed over as income tax reductions from negative gearing, which cost $18 billion last year and this year are predicted to hit $24 billion. 
Negative gearing lets investors deduct losses associated with their investment property from their taxable income. If the income received from rent is less than the interest paid on loans, depreciation and other costs, that difference comes off their taxable income. Combined with discounts on capital gains tax (the tax on money investors make when they sell a property), this allows rich landlords to buy properties, reduce their income tax and then sell the property for a killing when prices rise. 
Contrary to the myths pedalled by Labor, the Liberal Party and the property industry about “mum and dad” investors, the rich own most investment properties in Australia. The most common investors are surgeons and barristers, and the majority of investors own two or more properties. 
On the other side of the crisis are workers, students and the poor, and it’s a very different story for them. Rents across Australia rose by 12.8 percent last year, the biggest increase on record, and are set to rise a further 11 percent in 2023. In Sydney, rents for units have gone up by 18.6 percent, while in Melbourne they rose 20 percent. To afford to pay the $575 median rental in Sydney without being in rent stress (paying more than 30 percent of your income), you would need to be earning $100,000 a year. Soaring rents, low vacancy rates and the rising cost of living mean increasing numbers of renters are facing evictions, unsafe living conditions and homelessness. 
Public housing has been gutted as state governments sell off existing housing to developers and restrict access rather than building properties. Over the past 30 years, the supply of housing has been virtually halved, while in New South Wales alone, the number of applicants in urgent need has doubled in only three years. Nationwide, there are 176,000 households on the waiting lists, with many more estimated to need housing. 
These are the two sides of the housing crisis. The rich getting richer from investments and government handouts, while workers, students and the poor go to the wall. 
The Labor government has made it clear whose side it is on. When Anthony Albanese, who owns a couple of investment properties himself, was asked if his government would reduce the capital gains tax discounts going to the rich, his reply was an unequivocal “no”, with a “full stop, exclamation point”. 
The $100 billion going to the rich could instead be used to make housing more affordable. It’s enough to build 330,000 public housing properties or immediately raise the JobSeeker allowance above poverty levels. Add the $256 billion tax cut the government is giving Australia’s highest income earners and the $348 billion to be spent on nuclear submarines, and just think how much the lives of working-class people could be improved if the money was spent on housing, public health and education. But instead, the Labor government is committed to boosting the profits of the rich and preparing for war. 
To fix the housing crisis, let’s start by taking some money off the rich and building a fight against their profits and the politicians who do their bidding.

$100 billion handout to landlords

“If you don’t like it, move out.” This is the message from landlords to tenants who can’t afford rent increases amid a housing crisis that continues to worsen. 
Australia already had one of the most unaffordable housing markets in the world, but in the last twelve months rents have soared across the country. In the capital cities, they increased by an unprecedented 17.6 percent last year, the steepest annual rise ever recorded. In some areas, 20-40 percent hikes are the norm. Vacancy rates have dropped to 1.8 percent in Sydney, 1.7 percent in Melbourne and as low as 0.6 percent in Hobart and Adelaide. 
The average renter is now paying $3,000 a year more; overall, tenants paid an extra $7.1 billion in rent in 2022. Only 0.1 percent of rental properties are affordable for a person on a disability support pension, and almost half of low-income households are paying more than 30 percent of their income in rent. More than 163,000 people are on social housing waitlists, while 164,000 properties in Sydney and 1 million across Australia sit empty. And all of this is in the context of a general cost of living crisis, with wages stagnating while the price of essential goods goes up and up. 
Behind the figures is the brutal effect on the lives of working-class people. Some are living in tents because they can’t get places to live. Others are being handed eviction notices with rent increases to make sure they don’t use the few legal rights they have to challenge the increase. Families are turning up to inspections to find 100 others competing for the same property, and being told to lie about the number of kids they have to improve their chances of being approved. 
In Sydney, tarpaulin-covered balconies are being advertised for $300 a week. 
The immediate cause of the spike in rents is landlords cashing in on low vacancy rates and the associated increase in demand. Rental demand is increasing because of the unaffordability of home ownership, the lack of public housing and the return of international students to universities. With so many people desperate for a home, landlords have been able to impose rent increases that far outstrip inflation. 
The bigger picture is the effect of massive speculation in the property market over the last three decades. Investors accounted for 55 percent of purchases in 2015, up from 20 percent in 1993. Rich investors benefit from rising land values and are given huge financial incentives—basically government handouts—through negative gearing and capital gains tax exemptions, all in addition to collecting more than $43 billion in rent every year. 
Behind all of this is profit. Housing is provided according to what will make the rich richer, not to satisfy people’s most basic need for a home. 
But while the rich cash in and renters go to the wall, governments are doing nothing to address the crisis. Federal Labor’s plan to boost housing supply is simply a cash handout to developers for properties that will be sold at market prices and that would have built in any case. 
Its “big” promise to build 30,000 social and affordable housing properties over five years is an insult when experts say that 1 million public and affordable homes will be needed in the next decade. The houses that the government does build will be funded largely through speculation on the stock market and will be managed by private NGOs. 
In New South Wales, Labor is heading into next month’s state election promising a change to no-fault evictions but otherwise offering nothing more than a tweak to the administration of public housing. In Victoria, Daniel Andrews’ much vaunted $5.3 billion “Big Housing Build” has been little more than a massive sell-off of public land to private developers, with only marginal increases in net housing stock at a cost much higher than if the government had built the houses itself. 
Though you wouldn’t know it from the politicians, there is a lot that could and should be done now to make housing more affordable. Rents should be capped and reduced to a level that people can afford. Unfair evictions should be prevented, and vacant properties should be seized to house people on the social housing waiting lists. Negative gearing and capital gains tax exemptions should be abolished, and the revenues gained should be used to build the 1 million public housing properties that are needed to provide affordable homes and take pressure off the rental market. The private market in student housing should be shut down, and universities should be forced to provide affordable housing to their domestic and international students. 
These measures are all possible, but we can’t expect that any of it will happen without a fight—a fight that rejects the logic of the market and puts people before the profits of the rich.

A HAFF is not a home

Labor’s housing bills do nothing to fix the crisis

Five things to fix the housing crisis

We need public housing, not social housing

Property profiteers: who benefits from the housing crisis?

$100 billion handout to landlords

Solutions to the rental crisis

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