The University of New South Wales (UNSW) City Futures Centre Study has revealed that 84 per cent of respondents agreed with the statement “Australian governments have paid too little attention to how housing outcomes also affect productivity and growth”.
The survey – which has analysed attitudes of 47 economists and 40 senior figures from government, industry and academia – has also found that 80 per cent agreed that “rising mortgage debt poses an economic stability risk to Australia”.
On the other hand, only 12 per cent of respondents agreed with the statement that “over-expensive housing for low-income renters has little impact on economic productivity”.
Furthermore, the survey has found that there is a strong preference among respondents to direct federal government stimulus to social rather than private housing.
Almost seven in 10 (or 69 per cent) of respondents agreed that “coming out of COVID, stimulating housing is best achieved through social/affordable housing investment rather than private market”.
The study also revealed dissatisfaction with government policy around social housing, with only one in 10 agreed that “in its 2020 budget, the federal government rightly resisted calls for inclusion of social housing investment in its recovery stimulus package”.
In the past year, public housing waiting lists have grown another 4 per cent, while “high-need” applications have risen by 11 per cent, the research has found.
Speaking about the study for the research team, UNSW City Futures Research Centre director Professor Bill Randolph said the study has highlighted concerns about “over-reliance” on “ultra-low” interest rates for housing, employment and productivity.
“The vast bulk of housing experts and economists surveyed are concerned that ongoing Treasury dependence on ‘cheap money’ policy will further ratchet up house prices and widen the gap between rich and poor,” Professor Randolph said.
“From a purely economic perspective, the informed expert view is that this will undermine productivity and economic growth.”
Instead, Professor Randolph has suggested that one of the most effective methods to broaden Australia’s economic recovery strategy would be a large-scale national social housing program.
“Minimal construction for most of the past 25 years means that national social housing supply has effectively halved since the 1990s,” he said.
National advocacy campaign Everybody’s Home national spokesperson Kate Colvin said that social and economic dividend would become available if the federal government chose to invest in social and affordable housing.
“A $7-billion investment in social and affordable housing would unlock more than $18 billion in economic expansion, creating more than 18,000 jobs a year over four years, and making a serious dent in homelessness,” Ms Colvin said.
“Longer term, this would also boost productivity, by allowing people better access to jobs. Social housing can lift people out of poverty and put them on a path to prosperity.”
[Related: 75k tenants dealing with deferred rent debts]
Malavika Santhebennur is the features editor on the mortgages titles at Momentum Media.
Before joining the team in 2019, Malavika held roles with Money Management and Benchmark Media. She has been writing about financial services for the past six years.