Peter Dutton campaigning with his son, Harry. Mr Dutton avoided questions about whether he will act as the ‘bank of mum and dad’. Photo: Peter Dutton Facebook.
Both major parties went all out at their weekend campaign launches to make housing policy the priority for the election.
The PM promised Labor will spend $10 billion to build 100,000 new homes across Australia specifically for first home buyers, and allow all first home buyers to buy with just a 5 per cent deposit.
For its part, the Coalition will allow first-time home buyers who buy newly built homes to deduct mortgage payments from their income taxes.
Great news all around, right?
Master Builders Australia thinks so.
It issued two separate statements on the same day, applauding both parties’ policies and obviously focusing on the boost to construction and supply provisions of each announcement.
While such accolades were still being enjoyed – and while Anthony Albanese and Peter Dutton were still patting themselves on the back – some of the nation’s most respected economists had a different view.
Independent economist Saul Eslake took to social media on Sunday (13 April) after both the Prime Minister and the Leader of the Opposition had delivered their policies to rousing cheers from their respective party faithfuls.
“Today is a sad day for aspiring first home buyers,” Eslake said.
“Both major political parties are proposing policies which will add to upward pressure on housing prices at their respective campaign launches today – ostensibly to assist those trying to buy their first home, but in practice further enriching those who already own at least one.
“As they have been doing now for more than sixty years.”
Ouch!
Fellow independent economist Chris Richardson described both housing announcements as a “Krusty the Clown policy”.
“No matter what Labor and the Coalition say, their policies are merely reallocating shares of the pie – they’re not actually growing it,” Richardson said.
“Losers won’t realise their losses until after the election.”
Double ouch!
Both these commentators in the realm of economics have been in the game a long time, and they know their stuff, so when they speak, it is usually wise to listen.
But not the parties pushing their wares.
When confronted with the suggestion that their policies might actually push housing prices up, the political leaders brushed it off.
The Prime Minister acknowledged that “historically in Australia” house prices tend to rise anyway.
“What we want to do is to make sure that people have accessibility for home ownership,” Mr Albanese said.
“What we want to do is to take away the disincentive which is there, where people just can’t get a deposit.”
The Opposition Leader didn’t want to answer if the Coalition’s policy would drive home prices up.
He had a snappy comeback when that question was asked of him on Monday.
“Our policies will drive up home ownership,” Mr Dutton said.
“That’s what we’re on about here.”
The Liberal’s campaign spokesman James Paterson thought it wise to attack those who dared criticise the Coalition’s policy.
He went straight for the jugulars of the commentating economists.
“I have seen some of the commentary from economists and others, and I have to say when it comes from someone who owns their own home and probably bought it many years ago, it’s going to come across to many Australians as, frankly, pretty out of touch and tone-deaf,” he said.
“I think people underestimate the generational despair among young Australians who’ve lost hope that they’ll ever be able to buy a home.”
Huh?
When it was put to Senator Paterson that these economists might actually have quite some level of expert knowledge of how house prices work (even if they have owned homes themselves for some time), the Senator remained on message.
“We have a comprehensive plan that includes $5 billion for infrastructure to unlock 500,000 homes,” he said.
“That is building the water and the sewerage and the roads and the electricity that allows housing developments to be commenced.”
Yet, with all the policy spruiking aside, the expert commentators won’t be ignored.
Neither party can expect to win the election on their respective keystone housing handouts.
It’s not going to fly with voters to the degree the parties were hoping.
The policies and the subsequent slap-downs from economists have allowed Greens leader Adam Bandt to continue with his quip that the major parties are engaged in a “battle of the Band-Aids” over Australia’s housing crisis.
It also gave independent Senator from Tasmania Jacqui Lambie the best line of the day.
“Honestly, get out the popcorn. If they were such great policies, wouldn’t you have been running with them and selling them six months beforehand?”
Senator Lambie might well be just as wise as the economists on that point.
