The problem with housing RobP is that we're not releasing enough land quickly enough at one end of the equation, and we're also jamming more people into the country than ever before at the other end of the equation. In the middle of the equation the number of people per household is falling. The combination of these factors is an excess of demand over supply. Until you fix those factors, fiddling around with taxes and cost of housing will simply get capitalised into what someone is prepared to pay for a house, so the price of land will rise more quickly, but the price of housing won't fall.

Be at least a little realistic Arjay please.
$800.000 home? many pensioners live in on site caravans, and pay over half their income for the privilege.

yes indeed, I live in a caravan park on the pension and rental is not the biggest problem, mainly because once one is paying over I think about $70 per week one gets 75% reduction for any increase, which seems fair

so $70 pw is about 25% of the pension so if paying double that ie 140 the reduced amount is about $88 pw, ie still one third of total

main issue is the lump sum expenses eg car rego and espec repair bills which come out of the blue

and yeah, internet and Telstra stuff in general is a big burden

GrahamY,

It seems like there are problems no matter whichever way we turn. If we mandate or force increases in the aged pension to go into rent assistance, we just get what happened when the Government recently provided a rebate for childcare: entrepreneurs like Eddy Groves (of ABC learning) just whack their prices up to absorb the extra cash they know people have just received. In the case of rental, landlords may do exactly the same thing as they know ordinary people have no option but to pay extra.

As Lindsay Tanner said recently, the Government has to be careful that its handouts are not just lining the pockets of the corporate sector. Naturally, the Government doesn't like such an outcome because it is just tipping a bucketload of money into a bottomless pit before they can receive any political dividend (as well as not actually helping the ordinary people they were hoping to).

It's a vexed problem. The only real solution is to kill the avarice and opportunism in the market as it is these drivers that exploit the situation whatever our system happens to be. That, of course, is pretty much impossible to do. Time for a financial cataclysm maybe. Perhaps a "Freddie Mac" or "Fannie Mae" situation is needed in Australia to kill off the dangerously greedy.

Bad idea Graham.

I think it is about time that the more prudent among us started to gain from our efforts.

I know many renters, nearing pension age, who still have $5000 holidays, every year. They say that the government can look after them, when the time comes.

That $5000 could have bought them my house, but they chose to spend the money differently. That is their right, but I can see no reason that they should now expect the same standard of living, as those who planned & went without, for their future.

Perhaps some state run caravan parks, for these imprudent types. An increased pension would be better spent on house repairs for the thrifty. It would be nice to have the money to paint my house, now I can no longer do it myself.

Get the "rewards" going to the right people mate.

GrahamY
I’m not stalking you but you do raise interesting topics.
I agree with the poster who said give the pensioners more money cash in hand rather than rent assistance. My mum sort of owns her own home but still has problems with transport hence drives public transport is not appropriate.

I think that your argument about not enough land is a smoke screen. In one council area I know of there are existing land for about 23,000 houses. Yet no building why? The developers are land banking.

They run a number of techniques to manipulate the market by increasing the land price,legal but….
i.e. The area is an aging salad bowl to a major city. The Developers go around to farmers who are who are thinking retirement and offering options for inflated prices conditional on the land being re zoned residential.

Prompting
• The word spreads puting up the price of all land in the Council boundaries.
• Increases farmers' pressure on councils to rezone more res land.
• Which increases council's infrastructure costs (higher rates). Interconnecting roads/services to the estates gates. This in one council has blown their deficit from $5 to $23 million in 6 years. State govt (all persuasions) favour developers.
• Many farmers use the options to mortgage the farm and take an early retirement. Hence produce needs to come from further away (costs more)
• The increased land cost squeezes out the smaller spec builder they can’t raise enough money.
• Puts up the ultimate price of the house and home.
Add to the above they pick strategic farms in strategic areas to open up a bigger area.

Why? 10% profit on $10 mil = $1 mil. 10% $20 mil= $2 mil. The figures are indicative but the principle is sound.
There are a myriad of other techniques use to manipulate the market.

Many of the same tactics are reported to in use in at least 3 states (30 council areas) I am aware of. I haven't gone into the illegal ones either.

Graham is right,in NSW they intentionally do slow land releases to maximise Govt profits.37% of a house/land package is made up of Govt taxes and charges.They are making young familes pay for future infrastructure and their excesses.This is socialist Labor servicing it's heartland.Tax something and you will get less of it.Hence we have a housing shortage.Is anyone surprised?

Belly,decentralistion via rapid transit systems is a good option since it brings wealth to rural areas and takes the pressure off urban house prices.