Stop bankrolling investors and speculators!: A practical guide to providing quality shelter for all

Share with your friends










Submit

There’ s a monumental housing crisis in Australia. Rents are skyrocketing and vacancy rates are the lowest on record, pushing desperate tenants to resort to rent auctions. In 1996 the cost of buying a house was four times the average wage. Now it’ s more than seven times. Many households spend more than 30% of their incomes to pay the mortgage and 300,000 households are currently at risk of losing their homes. Between 1993 and 2003, funding for public housing declined in real terms by 28.4% — with people waiting up to 10 years to be housed. Every night, 100,000 people are homeless in the so-called lucky country.
This issue was ignored during the federal election. But the campaigning group, City Is Ours — supported by the Freedom Socialist Party and many other organisations — is determined to make the public housing crisis a major issue in the upcoming Victorian election.
Housing Minister Richard Wynne can talk the talk. In an August press release he said: “ we understand many vulnerable Victorian families are struggling in a tough private housing market, and housing affordability continues to be one of the biggest issues our community faces.” But Wynne can’ t walk the talk. Instead of directing money into building more public housing, he supports the National Rental Affordability Scheme. This rort gives developers tax incentives to build housing that will be offered for “ discounted” rent. Discounts are capped at the going exorbitant rate, less 20%. The scheme gives speculators a minimum of $8,000 per dwelling per year for 10 years and, at the end of this time, the landlord can do whatever they like with the property.
This public money should immediately be directed into public housing to provide real houses to the 41,107 applicants on the public housing waiting list in Victoria.
Hit hardest. Those worst affected by the housing crisis are women, young people, the elderly, people with disabilities, Indigenous Australians, queers and immigrants. Many are exploited and forced into desperate situations, such as sub-standard rooming houses or homelessness.
One in every two women with children in homeless services is escaping domestic violence. These women, often having escaped with little more than the clothes on their back, have low incomes and face huge costs in re-establishing their home. The number of children using housing services also continues to climb each year. Most are homeless due to their mother fleeing domestic violence. In other instances, the children have no home because of debt and eviction.
Fifty per cent of homeless people are under 25. Young lesbian and gay men have a higher rate than their heterosexual peers. High rents force many young queers to live with family with a lack of acceptance, which is a significant problem for many. The suicide attempt rate amongst same-sex attracted youth is four times that of heterosexuals.
The exploitative treatment of overseas students in the private rental market is a major scandal. In 2008, researchers from Monash and Melbourne Universities uncovered stories of rogue landlords overcrowding rooms and demanding sexual favours in return for accommodation. The report also found that the price of university housing increased by 37% between 2002 and 2006.
Indigenous Australians are massively over-represented amongst the homeless, comprising 2% of the population but almost 10% of homeless people. Many Aboriginal people live in appalling conditions. The majority of Aboriginal housing is very poorly maintained and overcrowded. This reality renders even more farcical recent attempts to encourage Aboriginal communities to give up title to communal land and get behind the “ great Australian dream” of home ownership.
Not a universal dream. For decades, governments have been obsessed with promoting home ownership. But there is nothing natural about the Australian model where this is seen as the norm and social housing — public and community — accommodates a miniscule 5% of households.
In the Netherlands, more than a third of all households are in the public sector. Half the population of Hong Kong lives in public housing. In France, every town must guarantee 20% public ownership of housing. In England, councils and housing associations own 20% of housing stock.
Rates of home ownership also vary widely. In Australia, 67% of households have a mortgage or own their home outright. The German home ownership rate is 42%: a key reason is the existence of laws favourable to tenants, including limits on rent increases.
The Australian housing sector, with its weak tenancy laws and reliance on the market, fuels poverty and insecurity. One-third of all renters now live with housing stress, spending 30% of their income or more on housing. Tenants can be evicted without a reason and notice periods are short. There are no restrictions on rent increases.
Government policies, which have tended to focus on demand rather than supply, have forced up housing prices, creating the belief that speculating in real estate is the way to get rich quick. The popular First Home-Owner Grants has been rightly renamed the “ First Home Vendors Scheme” because it rewarded speculators by inflating house prices.
The Commonwealth Rent Assistance scheme is another program that ultimately benefits landlords and speculators. Rent assistance — a payment to some pensioners and low-income families to assist with rent — privatises public housing assistance. When public housing was first established, it housed many workers. But the steady decline of this sector means that it now houses only the most disadvantaged, and often only on a temporary basis. So other low-income households are forced into the private rental market. Nearly a million individuals and families in receipt of rent assistance in 2001 were spending more than half of their income on rent.
Yet, ever more households have no choice but the market. The ratio of the housing expenditure from the public purse going to public housing, as opposed to the private sector, continues to decline. In 2006, the federal government spent just $1.3 billion on
the Commonwealth State Housing Agreement that funds public housing. In contrast, $2.1 billion was spent on rent assistance funnelled to the private sector.
For 11 years the Howard government looked to the market. The Gillard government expresses concern about the chronic lack of housing affordability, but continues with the same failed approach of relying on the market.
Under free market policies, the share of the housing market owned by speculators has boomed. In 1985, speculators held less than 15% of the market. By 2003, it had jumped to 45%! The richest 10% of Australians own 62% of rental properties in the private rental market.
Housing for all. Enormous as the housing problem may be, the solution is simple. The money clearly exists. It is a question of priorities. Politicians continue to give tax dollars to developers and the wealthy minority. It is up to working people to fight for quality housing for all as a guaranteed right.
If there is one major contributor to the rapid rise in house prices, it is speculation driven by tax breaks for landlords. We need to demand that governments free up funds by taxing big business and the rich. Capital gains tax for investment property must be increased, and negative gearing must be abolished immediately.
Public money directed to the National Rental Affordability Scheme should be immediate redirected to build public housing. There is an urgent need for a massive program to construct quality public housing. The immediate priority must be to provide public housing to all currently eligible for Commonwealth Rent Assistance. However, the goal must be to provide enough public housing stock for all who choose public housing to be eligible.
One simple way to provide rental stock, fully renovated at no cost to the tenant, is to confiscate substandard rental properties from greedy landlords. Those who provide decrepit accommodation forfeit their right to own it. Repair costs should be added to the former owner’ s tax bill.
The key to solving the housing crisis is this: everyone is entitled to decent, secure housing with no threat of arbitrary eviction. Everyone wants a home that is secure, affordable and that they can modify and make their own. This doesn’ t mean confiscating every privately owned house, but simply making it illegal to own property purpose of rental exploitation.
Champions of capitalism have had their chance to run the housing market and have caused disaster. Profiteering has no place in housing. Comfortable shelter — like air and water — should be guaranteed. In the end, the problem of housing is a case of their morals vs ours, and workers must do whatever it takes to make the government meet people’ s basic needs.

Share with your friends










Submit