The Housing Affordability Of Australia Growing Rapidly And How Effective Are The Government 's Policies Of Control It

To tackle the housing affordability, first of all, it is crucial to lift the supply of housing as it will release the pressure on the housing price. Nevertheless, the supply of housing is inelastic as it requires an adequate fund, time, approval from the Government. Besides, the housing system is heavily dependent on the private sector. Thus, the Government should provide initiatives for housing providers to shift the supply of houses in the market. Australia would follow the policies from other countries to tackle the housing affordability. However, it has to fit in the Australian context. These policies might work well in other places but it does not mean that it will be applicable in Australia. The Singapore Government has a public

Housing affordability has become a bigger problem in Australia over the last two decades. There is a growing fear within the community that young people are being squeezed out of the housing market and may never own their own home. However rents are also on the rise, meaning that housing affordability has the potential to affect a wide range of the community. The main reasons for rising house prices and decreasing affordability are demand outstripping supply, banks lending practices and rising interest rates. While it may not be a good idea for the government to intervene directly in the housing market through policies such as direct subsidies, there are actions they can take to manage the problem, such regulatory measures for financial institutions,

The recent policy regarding the Right to Buy propose to increase the discount under the Right to Buy scheme. This allows social tenants purchase their home at discounts of up to 50% of the value of their home, making home ownership more accessible (Brill, 2012). In addition, the Right to Buy sales make a major contribution to increase home ownership. There is an increase in the list number of people wanting accommodation. Therefore, it is worth to consider whether this has been one of the key drivers in recent changes in the UK housing system. The aim is making the housing system more affordable, for people on low income to be able to afford to buy their social housing and become home owners (Pattison, 2010). The increase demand of council housing of people with low income has brought about the recent changes in policy. It will also be the key driver of policy change in the

The ASIC chairman Greg Medcraft compared the situation in Melbourne and Sydney to the 2008 US housing slump. “Everyone thought prices would keep going up and obviously they didn’t. We’re a different economy with different mortgage structures, but you look around the world and history shows that the average ration from prices to incomes is something very important in residential housing.” Further interest rates cuts risks making property even less affordable for the younger generations and widening the wealth gap between property owners and those who don’t own a property, since the prices are rising at a greater pace than the average income. The RBAs decision to lower interest rates allowed house price inflation to continue significantly in the capital cities. If the current housing market keeps its direction, a bust could occur taking the Australian economy drop if interest rates were to suddenly rises.

Firstly, it is evident that current approaches to housing affordability are not adequately increasing housing stock at a rate that matches the scale of the problem. The physical limitations on land for

Australia is not the only one in its lodging moderateness emergency. A worldwide preview shows numerous administrations are standing up to blasting property costs, putting weight on low to direct pay workers. I agree with this issue because, truth be told what Australia have here is a long haul basic issue that has been dismissed for a considerable length of time. In 1982, the ABS Survey of Income and Housing uncovered that 168,000 or 10% of home purchasers spent more than 30% of their gross family salary on lodging expenses. Almost 30 years after the fact in 2011 these numbers had taken off to 640,000, proportionate to 21% of every single home purchaser. There are some explanation for this expanding cost of purchasing house. For

The housing industry is quite profitable a venture, though it is one that has caused many problems in today's economy, for two main reasons. First, the housing market has been quite volatile, simply because it has been under-regulated in certain areas and has therefore been the subject of a game of chess led by big corporations. Second, the housing industry is often a local matter, and is thus something that cannot be easily moved, transported, or transplanted, and for this reason it is in many ways unique. In order to better understand the way in which this industry works, this paper will discuss externalities, goods and services within this arena, as well as the many other concepts that relate to these terms.

Another demand factor affecting house prices is the cost and availability of mortgages. Interest rates affect homeowners’ ability to keep up with the mortgage repayments especially as the majority of the UK has variable mortgages. For this reason, from 2004 to 2008 when interest rates were rising, less people took out mortgages because for many, they were unaffordable and for others it was difficult to make repayments. Although, as per Sloman and Garratt, “when interest rates fall, the cost of servicing debts falls helping to fuel the demand for housing.” (Text Book) This supports the idea that when interest rates fall the demand for housing rises. As there are many different types of mortgages available (such as interest only and mortgages

This nearest housing boom happened in approximately 1998, until 2006. There has been belief that central bank affect on short-term interest rates helped to stimulate the booms. Mortgage interest rates were almost at historical lows. During the eight-year duration, households experienced money increases from both stock market increases and house price appreciation of unprecedented fractions. Maybe most damaging were assumption that this boom could continue(Baker, D,2008). Consequently, consumers went on spending sprees, based on increasingly real and perceived home stock values, similar as stock market increases. The fashion attitudes of “the big one is the better one,” or “as lone as one can afford,” or “avoid higher prices in future” became the main forces for house buyers. Finally, purchasing a house became sections of planning for retirement. Owning a house became a way to aid for retirement and enjoy the investment. As a result, many consumers mentioned the appreciation in their houses as a future sources of retirement funds. Even if the rapid downturn in stock markets from their lofty heights in about 2001 did not dispute the housing market.(Baker, D,2005)

The average rent on a home is costlier than paying a mortgage in every region of England even after accounting for homeowners’ repairs and maintenance costs [Shelter (The rent trap and the fading dream of owning a home, 2013)]. This is because, house prices are increasing and it is becoming more and more difficult to get a mortgage in the current climate. A cause being the demand outweighs the supply because there are too many people and not enough houses, which then drives up demand in other sectors, PRS in particular thus increasing rent prices.

Social trends can also affect house prices, recently a trend has emerged for later marriages, the mean age for marriage has increased by 8 years for men and women since 1972 (source: ONS). This has led to an increase in demand for smaller dwellings such as apartments, causing the prices of these forms of residence to rise.

Housing affordability is a prominent issue many New Zealanders are faced with. In particular, low-income households and first-time buyers experience great difficulty gaining access into the homeownership market and struggle to afford private rental housing. Current market conditions, commercial lending criteria and other factors tend to favour certain socio-economic groups, leaving low-income households and first-time buyers at a disadvantage. As a result, there is mounting pressure put on the government to create an affordable housing market for all potential buyers. Certain interventions may improve housing affordability for many, but not all potential buyers in the short-run. However, distinguishing between interventions which lower the price of housing versus interventions which actually increase housing affordability needs to be examined in-depth to determine the best long-term strategy for improvement. As the housing market became more profit driven, homeownership rates have dropped (Murphy., 2009) and low-income earners and first-time buyers suffered the most. Since then, rising house prices and falling affordability have been met with short-term fixes for a long-term issue. Increasing the supply of housing is needed before introducing other possible interventions. It will increase housing affordability in a more equal and fair manner and will see lasting long-run benefits.

An economic outlook from the Organisation for Economic Cooperation and Development (OECD) in June 2016 described the Australian housing market as “The unwinding of housing market tensions to date may presage dramatic and destabilis-ing developments, rather than herald a soft landing” (OECD 2016, ). This report rais-es the debate of ‘Australian housing bubble’ again to the hottest topic since 2014 when the International Monetary Fund (IMF) reported Australia as having the third highest house price-to-income ratio in the world (ABC 2014). However, the debate commenced even earlier back in 2001 after Howard first introduced the First Home Owners Grant in 2000 (KEEN 2016). Starting from then the housing price went up from a steady increase to boost in the following one and half decades.

Auckland is one of the most evolved cities with time. New Zealand as we know is a much recent country on the face of this world and so almost quite unknown to a lot of people in this world for a lot of time. But with time New Zealand gained its popularity with Auckland being the center of attraction of this beautiful country. Auckland is one of the most diversified cities in the world with people from all over the world especially from Asia. Auckland is serving far beyond that was expected from it much earlier by town planners and Councils heading the country. People from all over the world are coming to this city for a variety of reasons like education, business, work, travel, etc. This aim of the report is expanding the concept of the rising Auckland housing affordability problems with time and as to how to solve this problem for future growth of the city without being compromised. The report will firstly deal with

The rising house costs in New Zealand specific in Auckland are empowering more young experts to search elsewhere for a stable job with higher wages. Conversely, we are losing highly skilled Aucklanders to other regions in the country to pursue a better work-life balance. The major concern for the unaffordability of housing is creating a big issue to all Auckland based businesses as talented employees moved away from the city to escape from the increasing cost of living. This will threaten the vitality of many businesses or local organizations that rely on upon their talent. So because of this house costs are moving up faster than the wages of employees therefore this implies that housing is turning out to be less affordable. As indicated in an article by Nichol states that three quarters said they had lost employees to other locations in New Zealand or overseas, nearly half of them moved to Christchurch or Tauranga. Also many highly skilled people won’t move or come to Auckland because they won’t able to afford living here (Nichol, 2016). The housing cost in Auckland was extremely deterred in drawing in the middle income workers to Auckland city.