An ABC host put the finance minister on the spot after questioning how Australians could ever have hope of owning a home as prices drastically outpace wages.
ABC News Breakfast presenter James Glenday grilled Katy Gallagher on Monday over projections the median price for a house would soon rise by seven per cent.
‘By mid-next year, the median house price in Sydney, according to forecasts, is expected to hit $1.8 million,’ he said.
‘The median full-time worker earns about $90,000.
‘How can people under the age of 40 get excited about productivity and making the economy efficient when they can’t afford to buy a home?’
Gallagher said the country had failed to build enough homes for decades.
‘That is exactly the discussion that needs to be had around housing, and for us it is around the fact that we haven’t built enough houses for decades in this country, and the fact we have to look at how we speed that up and how we offer a range of housing options for people,’ she said.
‘Whether that be from looking at how we deal with the supported housing sector or affordable housing, all the way to home ownership.
Finance Minister Katy Gallagher (pictured right) said the nation’s housing situation would be examined at this week’s economic roundtable
News Breakfast host James Glenday (above) asked, ‘How can people under the age of 40 get excited about productivity… when they can’t afford to buy a home?’
‘We went to the election with policies around that. There is more work we have to do. It takes too long to build a house. That adds to the cost of housing. We have to make sure we are tackling these issues, otherwise these problems will continue.’
The issue will be central to Treasurer Jim Chalmers‘ economic roundtable in Canberra this week, where leaders are considering planning reforms and alternative housing options such as modular homes.
Australian Bureau of Statistics (ABS) data showed homes in Sydney would be worth nearly double the national average house price, which has just passed $1million.
The figure would equate to a $112,000 price hike, which is more than the average full-time worker’s annual salary – $103,000 before tax.
Melbourne prices are forecast to increase six per cent to $1.1 million after two years of market downturns.
Muval’s Family Relocation Report, based on more than 41,000 family moves over six years, showed many are already leaving Sydney in search of affordability and space.
‘Greater Sydney has experienced the highest loss of families, with a ratio of just 0.31, meaning that for every family that moved in, more than three have moved out,’ the report stated.
‘This may reflect the city’s soaring cost of living, rising property prices, and a growing desire among families for more space and less congestion.’
The median home-price in Sydney could be nearly double the national average by the end of the financial year, ABS data suggests (above, an auction in Homebush, Sydney)
It comes as data suggests many Aussies are ditching the most expensive cities for more affordable parts of the nation (above, western Sydney, which families are leaving in droves, according to Muval)
Melbourne’s inner suburbs, the ACT, and Sydney’s east, west and Parramatta regions have also seen more families leaving than arriving.
‘Meanwhile, affordability pressures are driving major shifts in ownership: nearly 17 per cent of families are going from owner-occupier to renter, while just 6.3 per cent are moving in the opposite direction, a stark reminder of how tough home ownership is becoming for many,’ the report stated.
Queensland, Western Australia, and Tasmania all experienced positive arrival ratios.
Last week, a leaked Treasury document revealed proposals to cut approval delays, including a national artificial intelligence plan to streamline environmental assessments.
More than 30,000 housing approvals are currently tied up under the Environment Protection and Biodiversity Conservation Act.
The Housing Industry Association has urged the federal government to act quickly.
Its submission warned taxes and charges on a standard Sydney house and land package can exceed $500,000.
‘Without urgent action to lift home building activity, productivity and investment, Australia’s housing crisis will only deepen,’ HIA Managing Director, Jocelyn Martin said.
‘The Treasurer’s roundtable presents a critical opportunity to address the barriers that are holding back new housing supply. You cannot talk about productivity, economic growth or improving living standards without discussing housing.
‘Red tape, regulation and delay are adding enormous costs to the delivery of new homes. If we want to see real reform, we need to boost productivity in our industry, cut the burden of unnecessary building and planning rules, and start making it easier to build homes.’