The Australian Housing and Urban Research Institute's (AHURI) annual conference is a crucial platform for addressing housing and urban planning policies, primarily supported by government funding. Surprisingly, the real estate sector has remained largely on the sidelines of AHURI's efforts. This is somewhat perplexing, considering that real estate represents and plays a pivotal role in approximately 97% of all homes in Australia.
In a gathering of roughly 80 speakers at the conference, only a handful of real estate agents, including myself, were in attendance. Instead, the majority of speakers and participants hailed from the not-for-profit social housing sector, dedicated to supporting marginalized Australians who struggle to find stable housing.
Stable and sustained shelter is a fundamental human right. Even as the housing market is a capital asset class, every Australian deserves a place to call home. Currently, about a third of Australians own their homes outright, another third hold mortgages, and the remainder rent. It's essential not to forget the approximately 160,000 individuals, as of the last census, who are without a home.
Participating in an international panel discussion on rental markets and systems, a common theme emerged — there's a significant housing supply problem. In the United States, there is an estimated four million home shortfall to meet demand. In Australia, we are projected to be 110,000 homes short within the next year, given the current pace of construction and migration trends.
Our rental market is primarily supplied by ordinary Australians, with the majority owning a single investment property. However, this group of property owners has been facing challenges.
Since the peak of COVID-19, investors have had to deal with rental moratoriums, rising mortgage costs, increased maintenance and insurance expenses, substantial changes to tenancy laws, higher land taxes, and criticism from various quarters.
There appears to be a shift away from relying heavily on individual investors to supply rental homes. With the current supply crisis, there is an urgent need for housing policies that actively encourage investors.
While there's a call for more government housing, these should primarily serve those genuinely unable to participate in the open housing market. It should not be the ambition of ordinary Australians to receive taxpayer-funded housing.
The BTR sector is often considered the "supply saviour." However, it primarily caters to investors looking for appealing returns on investment. They deliver high-end lifestyle rentals in premium locations, but affordability remains a challenge for many.
It's imperative to acknowledge the contributions of everyday investors, often labelled as 'mum and dad' or unsophisticated investors. They play a significant role in supplying rental homes in Australia. Let's stop undermining the individuals who provide much-needed homes to the market.