Homebuyers are set to be the winners of the biggest shake-up of property taxes and red tape impacting affordability, with a federal inquiry launched to zero in on all arms of government doing the worst damage.
All levels of government and all property taxes and red tape will go under the spotlight to see how they impact affordability and supply, according to a statement by the Federal House of Representatives Standing Committee on Tax and Revenue chair Jason Falinski.
He called the inquiry into housing affordability and supply in Australia “an urgent moral call for action by governments of all levels to restore the Australian dream for this generation and the ones that follow”.
A call for electronic submissions has opened asking individuals and organisations to have their say by Monday September 13.
Among its tasks, “the House of Representatives Standing Committee on Tax and Revenue will investigate the impact of tax and regulatory regimes on price, affordability, and supply of housing in Australia today as well as into the future”.
“As data provided by the Reserve Bank of Australia (RBA), the Treasury and the Australian Bureau of Statistics (ABS) shows, home ownership, one of the building blocks of Australian society, has been falling for the last 30 years,” Mr Falinski said.
He said arguments about the impact of increased subsidies and tax concessions on housing had been ongoing for some time.
“There is ample evidence that points to the small effect such measures have on supply, indeed the research points to limitations on land and restrictive planning laws as the major causes of shortages in supply.”
He said “regulatory settings are directly responsible for the unresponsive nature of housing supply in Australia”.
He said Australia had the fourth-fastest house price growth out of the world’s advanced economies over the past 20 years.
“The Organisation for Economic Co-operation and Development (OECD) conducted an analysis of Australia’s housing market, particular its very high ratio of housing prices to household incomes. The OECD concluded that Australia’s unusually high level of inelasticity in housing is the major driver of this ratio.”
He said ABS figures showed total residential private building approvals decreased 44 per cent across Australia from 2016 to 2020 compared to the previous five-year period while market supply had collapsed with CoreLogic new home listings down to record lows using the most recent five-year average.
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