City Futures Blog

News and research in housing and urban policy, from Australia’s leading urban policy research centre.

City Futures Blog random header image

The post-COVID crisis hit Queensland hardest. With 100,000 households needing low-cost housing, here’s how it can recover

Posted by on April 6th, 2023 · Housing

By Hal Pawson. A version of this story was first published in The Conversation. Read the original article here.

While the COVID emergency has waned over the past year, pandemic-generated pressures have left our rental housing market reeling. Australia-wide, vacancy rates remain close to rock bottom levels, while rental prices have been soared at record rates. Since the onset of the pandemic house rents have soared by 23% at the national level, but by a punishing (for tenants) 34% in Brisbane.

With recent homelessness increases likewise outpacing all other states or territories, it has been Queensland’s misfortune to find itself at the epicentre of the post-COVID housing storm. Little wonder, then, that Premier Palaszczuk decided to convene an extraordinary housing summit in October 2022.

Equally, although partly primed by the pandemic, many current housing policy challenges for both Queensland and the nation as a whole, have been building for decades. Perhaps the most important of these have been the ongoing decline of home ownership rates, especially among younger adults, and the increasingly inadequate capacity of the social housing system.

Recent policy initiatives fall far short

None of this is to say that Queensland’s current situation reflects a simple case of blameworthy state government inaction in the immediate past. As recognised in our recent report for Queensland Council of Social Service (QCOSS), for example, significant rental reforms have been progressed during the current term of government.

Moreover, as part of the state’s 2021 post-pandemic economic recovery package, the Queensland Treasurer pledged substantial new state-funded social housing investment, building on commitments already in place prior to the public health crisis.

Then, at the October 2022 housing summit, came the Premier’s commitment to double the Government’s housing future fund, a move compounding Queensland’s pledged support for new social and affordable housing construction over coming years. And beyond that, following the 2022 change of government in Canberra, there is also now a prospect of renewed Commonwealth investment in social and affordable housing, some of which will flow to Queensland.

Nevertheless, such initiatives follow a decade of generally intensifying housing stress, and insufficient attention to this policy challenge – at both state and Commonwealth levels. For example, annual social housing construction in Queensland averaged only around 500 during the ten years to 2020. Thus, while the state’s population grew by 17% in the decade to 2021, social housing stock expanded by just 2% – an effective cut in capacity.

So, while recently promised Queensland and Commonwealth social housing investment signals a welcome supply boost in coming years, there is a vast amount of ground to make up.

The scale of this challenge is graphically illustrated by our new research finding that the state’s unmet need for social housing exceeds 100,000 households – a total far in excess of official waiting list numbers. By our calculations, even to prevent the further intensification of current shortage will call for an annual output of between 1,500 and 2,700 new units – around double the number expected to be built over the next ten years under existing Queensland Government financial commitments.

An action plan: the key components

As argued in our report, the intricacy and deep-rootedness of Australia’s housing problems demands radical and sustained action by both levels of government. In some cases, necessary measures are mainly a matter of building on recent or ongoing Queensland Government initiatives – such as by further expanding the Queensland housing future fund to ramp up social housing investment, or by extending rental regulation reform to provide greater tenant security.

Some other recommended reforms partially echo proposals by construction and real estate industry bodies, such as encouraging purpose built rental housing development to expand overall housing supply and expand choice for consumers. Similarly, as overwhelmingly backed by mainstream economists, the Queensland Government should emulate the ACT in replacing stamp duty with a broad-based land tax. This will remove a barrier to house-moves and encourage more efficient use of existing housing stock.

Once again in line with most of Australia’s top economists, we urge the phase-out of private landlord tax concessions, a measure that could effectively enable a re-targeting of government support towards investment in meeting housing need, as well as helping to enable a gradual recovery in young adult home ownership rates.

Importantly, many desirable measures could be implemented to the benefit of the housing system but at little or no cost to government. For example, Queensland could enable stepped-up investment by not-for-profit community housing providers through conferring full ownership of CHP-managed properties originally built by government.

Another near-costless measure would be to mandate affordable housing contributions by private developers, as routinely operated in the City of Sydney, as well as – at scale – in countries such as the UK and USA. Contrary to the way that this is sometimes portrayed, the cost of such contributions is in fact borne by landowners, not by housebuilders or consumers.

Crucially, in tackling a policy challenge of this complexity governments must recognise that one-off cherry-picked initiatives are liable to be ineffective or even counter-productive. Instead, if they are serious about tackling the problem they must commit to concerted and coherent reforms within a meaningful overarching strategy.

We can only hope that the Commonwealth Government’s promised National Housing and Homelessness Plan – the first-ever initiative of its kind – opens up a pathway to rebalancing our housing system. Mobilising all of the many tools at its disposal, Queensland must act in concert.

No Comments so far ↓

There are no comments yet...Kick things off by filling out the form below.

Leave a Comment