Month: May 2025

SPA ARTICLE by Jennie Goldie

“And I say this message to the Senate and to members of the House of Representatives that, you know, we have a clear mandate to build more housing. The key is supply. The key is supply. You know, get out of the way and let the private sector build it. That is going to be one of my priorities.” Anthony Albanese, Press Conference, 5 May 2025.

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These sentiments were repeated by Home Affairs Minister Tony Burke on ABC-TV’s Q&A that night. The ‘key to solving the housing crisis is supply’ was the message from
the newly re-elected majority Labor Government.

Was this apparent suppression of the demand side of the
equation deliberate? Were they embarrassed that housing had become unaffordable for the majority during their watch, when immigration-fuelled population growth far exceeded the rate at which new homes were built?

The government needs reminding of what those figures were. According to the Australian Bureau of Statistics
(ABS), for the year ending 31 December 2022, population
growth was 496,756, of which just under four fifths was from Net Overseas Migration (NOM – immigration minus emigration). For the next year, ending 31 December 2023, population growth was 651,200, of which NOM was well over four-fifths. ABS don’t yet have the figures for December 2024, but for the year to September 2024, population
growth was 484,000 of which NOM was just under four fifths. The balance, of course, came from natural increase (births minus deaths) which is slowly declining but still
above 100,000 annually.

The downward trend in that final year was welcome but, on the basis of 2.5 people per household, 484,000 new
people would have required 193,600 homes. How many commenced construction in 2024? 168,049, a shortfall of around 25,000. Better than the previous year’s shortfall
of 100,000, but still not meeting new demand, let alone accumulated demand that includes the homeless; those living in tents or cars or sleeping on other people’s sofas.
It does not necessarily include those driven to the fringes of cities or regions because inner and middle suburbs are completely out of reach financially, but many of these
people are also severely disadvantaged by the housing
shortage and would benefit from more housing closer to
their workplaces.

In the lead-up to the election on 3 May, the Coalition and
some other parties finally made the connection between high population growth and the undersupply of housing and called for a significant reduction in NOM. Labor said
it would slow NOM to 260,000 people next financial year then maintain it at 235,000 per annum.

So assuming natural increase of around 100,000, that means population growth of 360,000 next financial year. On the basis of 2.5 people per household, that would
require an additional 144,000 homes in one year. Were Labor delivering on its Housing Accord, that would be
achievable. Labor is ostensibly investing $43 billion in housing with an ambitious target of building 1.2 million homes over the next five years; that’s 240,000 homes a
year. That’s a lot more, however, than the total of just under 170,000 that commenced construction in 2024. So the rate of construction will need to lift considerably if the
aims of the Housing Accord are to be realised.

There are many reasons why NOM, and in turn, population growth, needs to be reduced in this country. Housing is only one of them. The main reason is the preservation
of our environment; of our natural systems. Yet as far as housing is concerned, Labor would do well to quietly adopt one Coalition policy and cut 100,000 from immigration and then, and perhaps only then, will supply have any real hope of, not just matching new demand, but accumulated demand as well .

by Jennie Goldie

FOKE RESPONSE

What happens when ‘supply’ :

• destroys a place like Ku-ring-gai with the nation’s finest domestic architecture
• destroys one of Australia’s most environmentally sensitive local government areas in Sydney?
• does the PM really want FOKE to “get out of the way”, a theme echoed by NSW Minister Rose Jackson. Is this the same message that Tom Uren would have said to Sydney’s Resident Action Groups when the NSW Askin Government wanted to demolish Sydney’s inner city heritage? [actually Ton Uren told FOKE at a meeting in the early 2000s – “You have something special in Ku-ring-gai. Fight for it”]
• One of the biggest flaws to PM’s Albanese and NSW Premier Minns Housing reforms is the hand over housing to the private sector, whose sole rationale is to make profit and welcomes speculative investments that reap super profits to them by rezonings.

Is ‘supply’ really the key issue in solving the housing crisis? Isn’t it just going to perpetuate the housing crisis? What about:

• reducing and slowing down immigration levels to sustainable levels (70,000 per year)
• tax reform
• stopping ‘land banking’
• regulating Air B&Bs

The problem with “supply” is:

• construction costs have increased by more than 40% since the start of the pandemic
• Record numbers of construction firms have collapsed, reducing capacity across the industry
• builders are competing with government infrastructure projects for scarce labour
• labour shortages persist in key building trades
• the single biggest constraint on supply currently is that many housing projects are not commercially viable given current land, financing and development costs relative to expected sale prices . Is this is what is pushing up Ku-ring-gai’s rezoning to 10-28 storeys?
• the real fear is that ongoing strong immigration, combined with poor supply, will continue to pressure renters and result in more homelessness and overcrowding

Why is ‘demand’ suppressed, when every economic book talks about ‘supply’ and ‘demand’?

Isn’t it time to have an honest debate about the impact of ‘demand’ that is driving the unaffordability housing crisis in Australia?

31 December 2022, population growth was 496,756, of which just under four fifths was from Net Overseas Migration

31 December 2023, population growth was 651,200, of which just under four fifths was from Net Overseas Migration

September 2024, population growth was 484,000 of which just under four fifths was from Net Overseas Migration.

That is over a 1.5 million people from Dec 2022-Sept 2024.

So we destroy beautiful places across Australia and build towers for this intense population growth?

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Note: “inner and middle suburbs are completely out of reach financially”

In a Briefing Paper prepared for Scott Farlow, Shadow Minister for Planning, FOKE put the case that extreme levels of immigration numbers contributing to housing crisis and that:

• The Leader of the Opposition Mark Speakman has said that the Minns Labor Government needs to work with Federal Labor to reduce the state’s record high immigration rates in order to alleviate pressure on the housing market.

• Allowing the NSW Government to pursue its housing policy encourages the Federal Government to maintain unsustainably high levels of immigration. 

• Federal Labor needs to wind back their unsustainable levels of immigration to meet allow housing to catch up and meet a current supply issue. 

• Bringing in over 500,000, or even a reduced figure of 250,000 immigrants, creates demand pressures which will take generations of planning, resources and hundreds of billions of infrastructure dollars to satisfy.  Supply will always lag demand.  The only option is to remove the excess demand by reducing net overseas migration to around 70,000/year.  This can be done with immediate impact and at no cost.

Ku-ring-gai has to supply 23,500 dwellings in a five kilometre strip – along its North Shore Railway line between Roseville + Lindfield + Killara + Gordon Railway Stations.

This will fundamentally destroy, transform, bulldoze, deforest and irreversibly change the environment of Ku-ring-gai and Greater Sydney forever.

Not only is it happening in Ku-ring-gai but the population targets for each local government area across Sydney are forever increasing with more demand from population growth (the majority coming from migration).