Housing – draining the incomes of the poor and driving up wealth inequality

We’ve got good news and bad news. The (relatively) good news is that income inequality in Australia is not too high. And it’s not getting a whole lot worse.
But here’s the bad news. When you throw housing into the mix, life looks much grimmer. And at Shelter NSW, we would say more unfair. Lower-income people, increasingly renters, spend much more on their housing costs.
And then there’s the effect on wealth. This Grattan Institute article in The Conversation earlier this month provided an excellent, though concerning insight into these phenomena.

Grattan Institute – The Conversation

Who gets to be a millionaire? In this land of opportunity, theoretically anyone. But if you’re a property owner you’re halfway there. As this article points out, in 2019-20 25% of homeowning households reported net wealth in excess of $1million. The median net wealth for non-homeowning households is just $60,000.
We agree with the Institute’s call for commonwealth tax reform. And we certainly agree that enough housing needs to be produced to keep up with population growth.

But we have an additional ask: that Governments secure a solid proportion of the housing stock for lower-income people.
In NSW we’re calling for the Government that forms in March 2023 to commit to returning the safety net stock of social housing to 5% in the short-medium term and then 10% by 2040.