‘Not good enough’: Mark Bouris has a grim warning for Australia
One of Australia’s most prominent financial experts has sounded a grim warning about a growing crisis that threatens to derail the nation.
It’s time to have an honest conversation about the housing crisis – because it’s not going to get better anytime soon.
If you don’t believe me – take a look at the latest stats from the Australian Bureau of Statistics.
In March, only 12,500 homes were approved for construction. That’s the worst result since April 2012.
It’s almost 40 per cent below the government’s housing target.
Now let’s extrapolate that out onto an annualised basis. If we only built 12,500 homes in March and we maintain that rate for the rest of the year, we’ll only build 150,000 in the next 12 months.
That’s not good enough.
Remember the government’s target is 240,000 new homes every year. So we’re already behind. In fact, we’re almost 40 per cent behind.
And it’s not just me who is sounding the alarm.
Recently, the National Housing Supply and Affordability Council released its first State of the Housing System report.
It wasn’t pretty.
The report concluded that there’s a “significant shortfall in supply”.
The National Housing Supply and Affordability Council says the housing affordability crisis will worsen over the next six years.
Frankly – nobody should be surprised.
Ask any economist and they’ll tell you that prices and rents are growing faster than wages.
Ask any real estate agent and they’ll tell you that rental vacancies are near all-time lows.
Ask any public servant and they’ll tell you that there’s 169,000 people on public housing waiting lists.
Ask any charity worker and they’ll tell you that 122,000 people are currently homeless.
Wrap your head around that for a second.
Right now there’s 290,000 people who are either homeless or on the public housing waitlist in this country.
That’s the same population as Wagga Wagga, Goulburn, Albury and Toowoomba combined!
It’s not the Australian way.
And there’s no easy solution. Because our construction sector just isn’t up for it. Building material costs have skyrocketed since Covid.
Soaring interest rates have made it harder for property developers to get projects off the ground.
Labour shortages are crippling construction companies.
The list goes on … So what’s the solution? Well unfortunately, there’s no silver bullet.
Some will say it’s all about cutting red tape and making life easier for developers. Others will pin the problem exclusively on mass immigration.
Many will blame the destruction of Australia’s manufacturing industry and the explosion in power prices.
There’s truth to all these arguments. But what we need to do is be honest.
We need to be honest that we’re not going to meet the housing targets set by the government.
We need to be honest that there’s no single root cause or all-encompassing solution to this problem.
And we need to take decisive action as soon as possible.
We owe it to our children.
Mark Bouris is the Executive Chairman of Yellow Brick Road Home Loans.
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