The Federal Budget – throwing fuel onto the fire

In the midst of a damaging ‘housing bubble’ and rental affordability and availability crisis we at Shelter NSW had hoped to see this week’s 2021-22 Federal Budget reveal a commitment to a major social and affordable housing programs.
Like many we were disappointed to see no such commitment – and conversely some measures that will likely compound excessive demand issues already at play in the housing market.

The escalating crisis is reminder that the current housing system in this country – feeding off a particular set of regulatory, taxation incentives and lending conditions – does not provide affordable, accessible and secure housing for a large number of people.
Hence the need for a huge expansion of ‘non-market’ housing.

Most of the housing measures announced concerned helping people (albeit a small group) into home ownership. 

Don’t get us wrong.  We’re not against home ownership. But our concern is that while superficially attractive and politically popular, some of these measures by their design, will only really be accessible to a relatively small number of people.  Worse still, economists note some of these measures actually make housing affordability worse. 

As a snapshot here are the ‘housing’ announcements (drawing on the National-Shelter-Media-Release.pdf ):

  • The Family Home Guarantee intended to help some single parents to buy a home with as little as 2% deposit ( 2,500 offers each year will be available over four years).
  • Extension of the First Home Loan Guarantee scheme for another year. A further 10,000 guarantees will be available in 21/22 to first home buyers seeking to build a new home or buy a newly built home with a min 5% deposit.
  • Increasing the maximum amount of voluntary super contributions that can be released under the First Home Super Saver Scheme from $30,000 to $50,000.
  • The Homebuilder scheme providing $25,000, then $15,000 for eligible purchases and renovations (costed at $1.515b in 21/22 and $459m in 22/23).

We welcomed increases to funding for family and domestic violence services and especially the announcement of guaranteed equal pay funding for homelessness services.  That latter was due to be scrapped.  Congratulations to our fellow peak bodies both at the state and national level who fought so hard to secure funding for these critical services.  So many of these same colleagues will confirm though, that their work is made exponentially harder because of the lack of social housing across the nation and especially in NSW. 
All eyes now turn to the NSW Government Budget due to be announced in June.  We will continue to call for  a minimum extra 5,000 social housing dwellings each year for the next decade. For more information about our NSW Government Pre-Budget Submission please see here.