Realising the Great Australian Dream of Homeownership and a Vision of Housing Security
by Professor Paul Flatau , Director of the Centre for Social Impact, The University of Western Australia
The Op-Ed is an extract from Policy Matters Provocations by the UWA Public Policy Institute .
Homes Fit for All
In the depths of the Second World War, the Curtin Labor Government (1941-45), established the Australian Housing Commission under the auspices of Ben Chifley, Minister for Post-War Reconstruction.
The backdrop to this new government Commission?
The need for a massive boost in the Australian housing stock in order to address the "widespread deficiencies in quantity and quality of pre-war housing and the acuteness of the present shortage” (1).
The stated goal of the Commission was housing for all:
“… a dwelling of good standard and equipment is not only the need but the right of every citizen" (2).
The Australian Housing Commission set itself very ambitious yearly targets for affordable housing supply mainly for low-income households during the post-war period.
Notably, the Australian Housing Commission was concerned not just with increasing the public housing stock (to which its name became attached) but also with increasing affordable housing in the private rental market and in homeownership for low-income households.
The Rise of the Great Australian Dream
Fast forward to the 1970s and the term “the Great Australian Dream” becomes commonplace.
However, it is applied narrowly, only referring to homeownership. Lost is the broader goal of housing security for all Australians and across all housing tenures (3).
The late Jim Kemeny noted way back in 1977, that the Great Australian Dream elevated homeownership as “inherently the most superior form of tenure”. Moreover, when linked to the concept of ‘a property-owning democracy’, homeownership had solidified itself as “the most powerful ideology in Australian social and political life” (4).
Supported by generous tax breaks and other policy levers combined with rapid social mobility and changing aspirations, homeownership rates rose dramatically in the post-war period through to the 1960s, peaking at 73% in 1966. At the same time, public housing rates fell to 4.3% under the pressure applied by the Menzies Government (1949-66) to public housing. Homeownership rates at the national level hover around 67% today.
When viewed from a modern perspective, housing, irrespective of tenure, in the 1960s and 1970s was largely affordable and secure although it was recognised that much more still needed to be done (5).
The Slow Demise of the Great Australia Dream?
Fast forward from the 1970s to the present and there are clear signs that the Great Australian Dream of homeownership is slipping away for low-income Australian households. For example, the homeownership rate for those aged 25-55 is expected to fall significantly over the next 15 years (6).
Why?
A combination of inter-related factors is at play here including an increasing gap between income and house prices growth, increased property investment, and family and household formation trends.
At the same time as homeownership aspirations have come under pressure, we have also witnessed continuing high homelessness rates, increasing real rents and an historical decline in private rental security of tenure. These trends are all emblematic of the diminution of the post- War consensus on housing security for all.
Policymakers, in effect, turned their backs on the wartime Australian Housing Commission’s vision of a dwelling of good standard as the right of every Australian citizen.
Resuscitating the Great Australian Dream and a Vision of Housing Security
What then do we need to do to resuscitate the Great Australian Dream of homeownership and a vision of housing security?
A thumbnail sketch of several big ideas outlined below offer a pathway forward. These ideas need deep and sustained commitment from governments:
- Establish Hard Housing Supply Targets: We need to revisit and take on the task that the Australian Housing Commission presented to the wartime government of setting clear targets to increase the Australian housing stock available to low-to-medium income households as this will have the benefit of putting downward pressure on housing prices and rents (provided that there are not corresponding measures that increase demand).
- Enhanced Security of Tenure: Housing stability contributes to improved social and economic well- being, lower public expenditure (in the medium-to-long run), and enhanced productivity. Hence, we need to improve security of tenure, especially for those in the private rental market. Australia has relatively weak laws when it comes to the private rental market particularly in relation to requiring reasonable grounds for termination of leases and rent setting regulations when rents rise rapidly against the CPI.
- Enhanced Supported Housing for Vulnerable Groups: Homelessness and vulnerability remains a perennial and growing policy challenge across metropolitan and regional Australia. The last time
there was a determined policy effort to address homelessness by the Commonwealth was under the Rudd Government when it came to power with its The Road Home program. Homelessness is a complex ‘wicked problem’ and as such it requires a co-ordinated policy response from the Commonwealth and State/Territory governments. Increasing the supply of social and affordable housing is but an initial step. Crucially, what is needed is supportive/supported housing for those (re)entering housing with long histories of homelessness and high health and other needs. Relatedly, targeted prevention and early intervention programs that are culturally safe and appropriate, are required to turn off the tap of (re-)entry into homelessness for vulnerable and marginalised groups such as young people, victims of domestic violence, and Aboriginal and Torres Strait Islanders (7).
Conclusions
The Great Australian Dream remains the aspiration of most Australian households but is increasingly out of reach for younger people on low-to-middle incomes. Housing insecurity is now widespread for those without strong housing equity and some kind of wealth base.
The vision of the wartime Australian Housing Commission of secure housing for all remains the policy objective we all should aspire to. The Australian Government has taken a number of measures to improve housing outcomes via:
- the National Housing Accord;
- incentivising states to build more houses and support infrastructure development through the New Homes Bonus and the Housing Support Program;
- fostering improved planning and zoning; and,
- supporting skills development.
And, the Western Australian Government is doing its bit through significant new capital funding for social housing, albeit after a period of inaction.
Ultimately, greater political ambition and policy resourcing from federal and state governments of all persuasions is required and long overdue. A return to commitment and actions of the old Australian Housing Commission will pave the way for a fairer and more productive Australia.
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(1) Hill, M.R. (1964) Housing—Twenty Years After. The Australian Quarterly, 36(3), 45-55. Ramsay, A. M. (1945). Housing problems. The Australian Quarterly, 17(4), 87-94.
(2) Hill, 1964, p. 45.
(3) Apps, P. (1976). Home Ownership—The Australian Dream. The Australian Quarterly, 48(4), 64-75.
(4) Kemeny, J. (1977) ‘A political sociology of home ownership in Australia’. The Australian and New Zealand Journal of Sociology, 13(1), 47-52.
(5) Gribbin, C., and Newton, P. (1979). Housing aspirations: some implications for welfare housing policy. Swinburne. Conference contribution. https://doi.org/10.25916/sut.2... .
(6) Burke, T., Nygaard C., Ralston L. (2020) Australian home ownership: past reflections, future directions, AHURI Final Report 328, Australian Housing and Urban Research Institute Limited, Melbourne, http://www.ahuri.edu.au/research/final- reports/328.
(7) Flatau et al., (2021) Ending homelessness in Australia: An evidence and policy deep dive. Perth: Centre for Social Impact, UWA/UNSW. https://doi.org/10.25916/ntba-f006