Michael Pascoe is wrong to point to the inconsistencies of the property articles in the papers in yesterday’s Crikey (item 22) and conclude that “it’s just called market cycles working out”. There is a crisis in the nation’s housing markets, a result of poor Commonwealth Government decision making and a pact between the industry and a property-obsessed media. It’s time some myths were burst.
The first is that property is a transparent market. It isn’t. Real estate lobby groups and developers spend lots of money telling consumers why now is the perfect time to invest and telling governments that the sky will fall in if tax breaks on property are ever reformed.
The second myth, arising from the first, is that the media reports property impartially. Almost every story and most reports on housing come from property organisations interested in advancing the prosperity of their members. These voices are all we hear, usually surrounded by acres of property classifieds. And how do you ensure that people read the ads? By surrounding them with what looks like impartial journalism but is often a template of self-serving quotes by bank economists or the very real estate agents whose ads appear later in the supplement. How else can one explain yesterday’s figures from the Real Estate Institute of NSW claiming rents would rise by 20%, despite the fact that no independent evidence or historical data supports this claim?
The third and most disturbing myth is that the Government can’t do anything for struggling home purchasers. It is a fact, widely accepted even by industry, that the Howard Government has contributed to record high house prices and skyrocketing rents by halving the capital gains tax in 1999. It has also refused to consider targeting the almost $18 billion in tax breaks enjoyed by wealthy property owners to ensure that investment in low cost affordable housing is preferred.
The Howard Government refuses to do anything about this crisis. It doesn’t even have a housing minister. Maybe that’s why it refuses to reinvest in public housing (despite cutting it by 30% in the last decade), reform a rent assistance scheme that fails 35% of its recipients, or even do anything meaningful for low and middle income home purchasers. 25% per cent of Australians have a roof over their heads thanks to renting but nothing is done to help them.
And why should it when the media rarely reports the fact the housing market is rigged and that the Government is capable of making it fairer? What struggling renters and first home buyers need is a media that tells the truth about property. Maybe then we’d have a Federal Government that would care more about their plight than that of its wealthy supporters. Only then would we see a rational and transparent housing market that delivers affordable and appropriate housing.