We can finally be confident in saying that our political leaders have accepted that there is a housing supply crisis.

But action on the ground is slow.  Approvals remain at a nadir and NIMBYs continue to frustrate at every opportunity.

In the meantime, the same old political debates we have become used to are stopping moves to fix the problem of housing supply and this time, it’s the Federal Greens who are playing politics.

The passage of the $10 billion Housing Affordability Future Fund legislation is stuck in the Senate.

The earnings from the fund will support a minimum of $500 million per year to be allocated by the National Housing Finance Investment Corporation to deliver social and affordable housing.  The Greens seem to think that millennials will vote for a party which backs social housing to solve the problem and are holding out for a much larger and recurrent budget allocation for social housing.

In the meantime, as discussed in detail later in this article, millennials are growing sick and tired of NIMBYs and the Baby Boomer generation protecting the amenity of their assets by excluding urban density and housing supply.

There are very real risks to restoring housing supply numbers and the National Housing Accord.

The Accord, signed by all State Governments and the Commonwealth, commits to the completion of 1,000,000 new dwellings across Australia over the 5 years starting July 1, 2024. The population share in NSW means that the NSW planning system, in conjunction with the private housing development and construction sector, needs to deliver 315,000 new homes over the next 5 years.  That’s 63,000 completed homes every year, for 5 years.

To put the NSW challenge into context, in the current financial year, the number of completed dwellings expected to be delivered is 42,000.  So to get that number up to 63,000, there needs to be a 50% increase!  The numbers are similar in every state.

That means serious change is needed in the planning system.  We need all the greenfield homes currently in the pipeline, as well as substantial growth in this area, supported by core infrastructure.

We also need to see substantial infill development and that will mean changes to the character of some local communities, particularly those that have benefitted from publicly funded investment in infrastructure, but have hitherto been given only low housing growth targets.

There remains a chronic shortage of many skilled trades and consultant engineers.  Increased migration numbers will assist this, but this area has relied on an ageing cohort for over a decade and COVID saw many simply exit the industry for good.  Worse, planning policy makers have failed so dramatically that there is simply nowhere for these new migrants to live.

To make things worse, Treasury bean-counters can’t resist any opportunity to hit the property development sector with fees and charges when budgets get tight (even though they know that taxes hinder growth and deter investment thus potentially resulting in less revenue and fewer new homes being delivered).  These new taxes, be they new water infrastructure charges or regional infrastructure charges, get passed onto new home buyers. Rising interest rates have made new homeowners’ lives miserable enough without them having to fill the (albeit depleted) Treasury coffers.  In many cases these new fees and charges will actually stop houses being built – so there will be no tax revenue and there will no housing supply either!

ASIC reports that five building companies have gone broke every single day this year.  That is because construction costs have risen dramatically but the prices that home buyers are paying are locked in when the deposit is taken – leaving builders out of “the money” and making a loss.  Developers have been supporting builders by absorbing much of this escalation, so margins are already tight, without any new taxes or charges.

Young Australians are getting angry

When the boomers were in their teens, a folk singer songwriter by the name of Bob Dylan wrote a song “Like a Rolling Stone” with a line “If you ain’t got nothing you got nothing to lose”.

This sense of hopelessness is something that is growing to the point that it is now being acutely felt by our younger generations when it comes to housing.

During the lead up to the NSW election in March, concerns were emerging in younger voters as the cost of housing grew alarmingly as a multiple of their incomes.  More specifically, the cost of renting also rocketed. The Liberal Party lost votes in Western Sydney because they had failed to deliver housing supply fairly or evenly across Greater Sydney.

We have seen over the last few months a sense of frustration, and at times desperation, transform into more passionate, angrier voices.

Skyrocketing rents have been driving inflation, which in turn forces the RBA’s hand into higher interest rates, which leads to higher rents, thus adding to inflation, has become a vicious circle in which younger generations are particularly ensnared. The only way to break this cycle is fresh housing supply.

The angry message of youth is being heard across an array of media outlets – with mainstream outlets picking up this dissatisfaction with the status quo and abandoning the Boomers cause with alacrity.

For example (and there are many), Sky News’ AM Agenda interviewed Redbridge Group Director Simon Welch this week who, having sat in on countless focus groups, issued a warning to Labor Governments (now across the board bar Tasmania) that housing could do to Labor what climate change did to the Liberals. Talking about a Housing Accord is great, but what is happening to deliver it?

The Liberals and the Greens are still talking the language of the boomers in the contented and protected inner suburb enclaves across Sydney’s lower north shore, eastern suburbs and the inner west.  That rhetoric is directly opposed to improving housing supply and is a massive turn-off for young voters.

If either the Liberals or Greens recalibrate their policies to have immediate relevance to younger voters, they might start to put a dent into the national hegemony Labor holds.

Delivering housing supply – not just social or affordable housing – but a range of housing located close to transport with the amenity desired by youth must be supported. And it means a range of housing types – co living, BTR, along a big pickup in apartment construction – the housing stock that young people predominantly rent or buy.

Younger generations are waking up to the fact that they are getting the rawest deal from the housing supply crisis.  Canny politicians, and in-touch Governments, will do well if they heed these concerns and respond in a meaningful way.

The times, they are a-changin’!