Housing fix urgent
The housing market is riddled with vested interests who benefit from the status quo, but Keith Jacobs and Kathleen Flanagan say these obstacles must be overcome or low-income households will continue to struggle
THE University of Tasmania’s Housing and Community Research Unit recently published an update on conditions in the Tasmanian housing market.
The data covered the period between March 2020 and March 2021 and included analysis of changes in housing costs, the demand for affordable housing, the public and private supply response, short stay accommodation trends, housing insecurity and homelessness.
The overall trend was clear. Far too many low-income Tasmanian households struggled to meet their housing costs.
The vacancy rate for private rental properties was amongt the lowest of all Australian cities at 1.9 per cent and the cost of rent relative to income meant that Hobart was now the least affordable capital city in the nation.
The problems in the rental market were compounded by a high proportion of landlords renting out their properties on short stay accommodation platforms.
House prices had continued to soar: the value of dwellings in Hobart had increased by 12.5 per cent, and by 15.3 per cent across the rest of the state.
There remained an acute shortage of social (public and community) housing dwellings (other research has estimated a shortfall of as many as 14,200 dwellings by 2035).
By March 2021, there were 4006 applicants on the housing register, an increase of 11.9 per cent over the previous year.
We will need to wait for the results of the 2021 Census to accurately estimate the number of homeless people currently in Tasmania but in March 2021 there were 2653 clients receiving assistance from Tasmania’s specialist homelessness services, which was an increase of 9 per cent from March 2019.
The bits and pieces of data that have emerged from other sources since our analysis has confirmed these trends or indicated that things have become even worse.
In response to pressure from advocacy groups, the Tasmanian government has provided funding to build more social housing.
In the 2021 election campaign, the government committed $280 million to deliver 2000 new dwellings over the next four years, adding to an earlier commitment to build 1500 dwellings over three years.
Alongside this commitment, the government continues to provide grants to first home buyers, but according to most economists, such grants exacerbate house price inflation, which arguably adds to the problem the new investment in public housing is meant to address.
It is true that some of this assistance is designed to function as necessary economic stimulus in the wake of the Covid-19 pandemic, but with the consequences of further affordability pressures, especially for low-income households.
The housing crisis described above is attributable to the failure of successive governments, both commonwealth and state, and on all sides of politics, to adequately address social inequality.
The Australian housing system is configured to enable those who are already wealthy (including homeowners, landlords and developers) to accrue further wealth, while those without wealth must rely on a residualised social housing system or insecure and often poor-quality private rental.
Chronic underfunding of public housing over decades means the safety net is insufficient to meet even the needs of those on the social housing waiting list, much less the thousands of other households in housing stress.
How can we change this situation?
Our analysis indicates that our community needs to find the answers to three important and urgent questions:
How do we tackle the political obstacles impeding the growth of the public housing system to a scale that is able to genuinely meet demand?
How do we ensure our private rental sector is fit for the purpose to which it is increasingly being put— the accommodation of marginalised and low-income households?
And how do we ensure housing market subsidies benefit those in greatest need rather than inflating house prices for everyone?
A community-wide response to these questions, backed by concrete action and lasting action, is long overdue.
We recognise that the process will not be easy.
The housing market is riddled with vested interests who benefit from the status quo.
However, without finding answers to the questions above, it is difficult to be optimistic about the housing prospects of too many lowincome households in Tasmania.