Housing costs to haunt us for a decade analyst says
Michael Matusik A RETURN to affordability in the Queensland housing market is likely to come by way of a slow deflation in prices until wages and rents catch up – and it could take a decade, according to a Brisbane property analyst.
Michael Matusik says slow deflation occurred in the 1990s and history is likely to repeat itself so long as people remain in employment and meet mortgage payments.
His comments follow release in late January of the latest Demographia International Housing Affordability Survey which listed 27 cities and towns in Australia as severely unaffordable.
Of severely unaffordable housing markets, Townsville was ranked number 54 in the world.
Coffs Harbour came i n fifth, Melbourne sixth, the Sunshine Coast eighth and Gold Coast twelfth.
The world’s most unaffordable centre was Hong Kong, with Sydney in second place.
Mr Matusik said the crea t i o n o f a f f o r d a b l e new homes is a major national issue which authorities have failed to address, despite it being amenable to resolution by governments.
H e s a y s a n u mb e r o f changes would contribute to resolving the problem including faster processing of rezoning and development applications and a more judicious application of taxes.
Tax changes should include removing the GST on newhome construction, replacing the present user-pays upfront infrastructure charges model with one that imposes a n n u a l i n f r a s t r u c t u r e charges over the life of a project and reducing stamp duties on sale of new-built homes.
Also, Mr Matusik said, governments should provide infrastructure in advance of n e e d , d e c e n t r a l i s e t h e workforce and population to regional centres and match migration supply to jobs.
However, he does not see the changes as likely to occur.
‘‘ We would do something about it if we could, but doing such requires government action, which we all know isn’t going to happen,’’ he said. ‘‘ So nothing much will change, resulting in people moving less, more renovating in place, and fewer property transactions.’’