Federal government policies to bolster the housing sector have distorted the operation of a free market economy with resources rushing into the housing sector to receive favourable tax treatment.

Specifically these actions were

1. the new home owners grant started in 2000.

2. continuation of negative gearing on investment properties

3. reduction of capital gains tax on investment property held for more than 12 months

Demographers have shown that migration increases demand for housing and most migrants gravitate to Sydney or Melbourne where unemployment rates are highest.

Foundation

Continuously high demand very directly affects urban land values or land and house packages, because it applies pressure on councils in growth-pressure areas to constantly approve new subdivisions.

Of course, councils are reluctant to do this without a whole lot of careful planning - considering the loss of agricultural land or bushland, providing infrastructure and services and considering the increased pressure on infrastructure and services in the greater community, considering effects on overall quality-of-life factors for the whole community and the increased pressure on the regional environment. Even the most pro-growth and real-estate-friendly councils have to consider at least some of these things very carefully. Hence their careful approval processes and reluctance to open up more land at a rate sufficient to keep prices down.

I would also say that in some instances councils are inclined to retard approval processes in order to increase land values, which both benefits their real-estate buddies and themselves by way of higher per-capita rates and it may slow growth to some extent thus reducing all the extra things that a council has to worry about that go with that growth.

Whatever the case, the simple fact is that a strong demand requires an abundant supply. The abundant supply is very understandably mitigated somewhat while the demand is not directly. If it follows that increasing the supply of land will lower prices, it must also follow that decreasing that demand will do the same. And therein is the main connection between our rapid population growth and high prices. And a very strong connection it is too.

Foundation, I am not just talking about immigration here. Our birthrate, interstate transmigration and seachange movement are also large aspects of this population growth issue, from national to local levels.

Unfortunately you have flipped off into loopy la la land far too early in this debate, well before you fully understand my viewpoint (in reference to your bizarre canetoad carry-on)!!

Supply & demand
Supply & demand
Supply & demand

Enviromentalism for the sake of enviromentalism is starting to cost big time .

Capital gains tax should be called envy tax as that’s all it is .

Who really pays capital gains/envy tax anyway ?
The seller ? Get real .
The buyer pays cgt as the seller has already factored in cgt liability if applicable in the minimum price that will be accepted for the property .
This means that the buyer will not only pay the initial cgt liability but will continue to pay for it through mortgage interest .
Or if the property is rented out the tenant will pay that cgt cost as part of their rent .
Capital gains/envy tax along with all other arbitary fees will always be passed on to the consumer .

Ludwig your heart’s in the right place friend & I recon we’d agree on a great many things including the poorly planned population growth thing , But mate try to have faith in the power of mother nature to sort out imbalance , You’ll get an ulcer . Were all only bacteria anyway .

STOP RELEASING LAND IN SYDNEY AND SEQ AND SHOW Howard WHO'S THE BOSS>>

Limits on Supply and demand:

Confucius say: Man who demand virgin open legs and take supply are rapist.

Making available ever larger areas of land to be largely denuded of trees, as is now happening at Berrinba wetlands in Logan Shire, south of Brisbane and as will soon be threatened to the Minnippi parklands within Brisbane is not a sustainable solution to the housing affordability crisis.

Those political leaders in Queensland, who deliberately increased the population by 1,000,000 in the last 15 years, and then basked on the glory of this supposed 'achievement', never bothered to think of where the necessary resources to support the additional population would come from.

The most striking evidence of this is, of course, the current water crisis. Another problem that is not widely known, is that Morton Bay is disappearing as more and more silt, which is running off from the ever greater areas of land under development, is deposited there.

Now they plan to increase the population by yet another 1.25 million by 2026.

In an article entitled "Owning a slice of the action" in the Courier Mail on 23 June, it was predicted by the Real Estate Institute of Queensland that in the next 10 years alone, average house prices would increase from the $365,000, already unreachable for many to the stratospheric figure of $800,000. In order to allow people to pay for this, financial institutions are planning to extend housing mortgage repayment periods to 40 years, or even 50 years.

The vision that the REIQ had for SEQ, as further revealed in the article, further included:

" ... we will be living on smaller blocks as more people move to the southeast corner. ... The current water crisis will mean nature's drop will be rare, ensuring most houses will have minimal lawns and garden. ... A session in entertainment rooms will replace the smell of fresh air and a potter around in the vegie patch. Besides most workers won't be bothered about gardening at the end of a long day at the office."

(to be continued)

(continued from above)

No doubt the 'long day at the office' will be made necessary by the mortgage repayments.

Whilst the REIQ openly relishes this future, I would expect that the rest of us would be struck with horror.

Andrew, is this the sort of future you want for South East Queensland?

If not, please tell us why you believe that the REIQ are wrong and how you believe it can be avoided if the planned growth in the population of SEQ continues.

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The other driver of housing unaffordability is, of course, as Andrew has correctly alluded to, the private property market. The Housing Trust of South Australia, which for decades provided all strata of South Australian society decent affordable housing for decades, never cost South Australian taxpayers a cent.

In spite of the obvious success of this and other public housing programs, they have been wound back, and the consequences are indisputable.

It strikes me as quite odd that many people on this forum who express resentment at paying taxes to support people on social welfare, evidently, have no objection to themselves and the rest of us paying far more to support the lifestyles of a sector of society that the experience of the HTSA has shown, we could get by quite well without.