Late last Friday, on the eve of the ANZAC Day weekend, the Melbourne Storm scandal raged in the Australian media. It was then that the Rudd Government chose to announce in a statement that it was reversing its policy of allowing non-residents into the Australian housing market in unprecedented numbers.
It was the third policy backflip in as many days, all under the cover of the media storm about the Melbourne Rugby League club. First, the government pulled the plug on its home insulation scheme, citing the billion dollars required to clean-up its previous mess.
Then it surreptitiously announced that the promised 230 child care centres would not be built, also by media release.
Days before the third announcement, the government was still claiming that there were no problems with foreigners purchasing Australian houses. This was contrary to the growing anger in suburban Australia, as local buyers found themselves regularly outbid by overseas buyers.
For weeks, my claims that the Rudd policy was forcing Australians out of the market and inflating house prices was met with disdain. Even a warning from the Reserve Bank Governor, Glenn Stevens, was ignored.
But with an election looming, the policy has been reversed, even though the government still thinks there is no problem.
The Rudd government has scored the quadrella for housing unaffordability. First, State governments have limited land releases across the country. Then the Rudd government engineered a massive spike in immigration. Thirdly, its wasteful stimulus package encouraged people to buy houses at low interest rates, only to see them hit as the Reserve Bank pushed the rates up again to counter inflation.
This was compounded by a decision in April 2008 to open up the residential housing market to non-residents.
The result was startling. In many suburbs, the majority of sales have been to overseas purchasers. Locals have been priced out of housing in their own cities. Real Estate Agents across the nation report multiple sales to overseas families who have stockpiled Australian houses for their capital gains.
To add insult to injury, many have remained unoccupied, the houses locked up and the gardens left unkempt. Others have become virtual boarding houses for multiple tenants.
When announcing the backflip, Senator Sherry was unconvinced of the need, seeming to doubt the anecdotal evidence of the sales. Had his government not removed the reporting requirements, there would have been substantial evidence of what had become well-known in suburban Australia.
What this episode reveals is a Labor government out of touch with ordinary Australians. Kevin Rudd’s “big Australia”, driven by high rates of permanent and temporary immigration is threatening the liveability of the nation.
Before the 2007 election, Tanya Plibersek complained about the cost of housing. Under her watch as housing minister, homes have become even less affordable. Housing prices are 29 per cent above the long-term trend.
And the government’s response? A Population Minister who is confused about our future population needs and an inquiry that will report – you guessed it – after the next election!
Kevin Rudd not only believes that a population of 36 million by 2050 is good for Australia, but increasing numbers of foreigners should also be able to purchase our houses as well.
Senator Sherry’s unconvincing responses when commenting on the policy reversal suggest that Labor will relax the policy again in the future if it gets the chance.
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