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Speaker 1: Good morning and welcome to the Daily OS. It's the

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Speaker 1: third of May and today's podcast we're going to be

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Speaker 1: chatting to TDA journalist Tom Crowley about everything to do

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Speaker 1: with the housing market. It's become a hot election topic

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Speaker 1: and Tom's here to tell you just why that is.

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Speaker 1: But firstam, what is making headlines in the news today?

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Speaker 2: A very interesting day ahead, Zara. It is expected the

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Speaker 2: Reserve Bank of Australia will raise interest rates at a

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Speaker 2: meeting today. Hope you liked that pun for your Tuesday.

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Speaker 2: This comes as prices rose two point one percent in

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Speaker 2: the first three months of twenty twenty two and five

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Speaker 2: point one percent over the past twelve months.

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Speaker 1: Quantus announced yesterday it plans to operate NonStop flights from

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Speaker 1: Sydney to London and New York by the end of

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Speaker 1: twenty twenty five. The flights will be about twenty hours long,

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Speaker 1: making them the longest passenger flights in the world.

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Speaker 2: India and Pakistan have experienced several days of extreme heat,

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Speaker 2: with temperatures above forty five degrees. The heat wave, which

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Speaker 2: is unusually early this year, is a health risk to

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Speaker 2: millions of people and has led to power and water

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Speaker 2: shortages and affected key crops. The UN says temperatures are

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Speaker 2: expected to ease over the next few days.

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Speaker 1: Finally, to some good news for your Tuesday morning, the

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Speaker 1: Australian women's rugby sevens team has secured their first World

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Speaker 1: Series title since twenty eighteen after player Lily Dick scored

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Speaker 1: a try in the final seconds of the match against

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Speaker 1: New Zealand.

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Speaker 2: An Australian labor government will help you achieve the great

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Speaker 2: Australian dream of home ownership.

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Speaker 3: Our plan is for Australians to own their own home,

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Speaker 3: not for the government. Nanthey Albanezi to own your home.

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Speaker 1: All right. So for today's Deep Dive, I'm joined in

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Speaker 1: person very special by Tom Crowley. He's a journalist here

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Speaker 1: at TDA. And look, Tom, I know you're a really

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Speaker 1: good journalist. You understand politics, but you don't need to

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Speaker 1: be the best in the biers to tell me I

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Speaker 1: can't afford a house right now, but you can provide

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Speaker 1: some insights into why that might be. So start from

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Speaker 1: the beginning. Why are we talking about housing today?

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Speaker 3: Thank you, Zara. It's wonderful to be here. Of course

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Speaker 3: I normally record the podcast remotely from Melbourne, but it's

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Speaker 3: nice to be in Sydney this week. I think it's

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Speaker 3: fair to say that houses are not very affordable in

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Speaker 3: either of those cities. Melbourne and Sydney definitely at the

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Speaker 3: epicenter of this housing crisis. It's a problem that's been

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Speaker 3: going on for years and years, and I think the

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Speaker 3: best way so we had a graph in a story

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Speaker 3: that we did about this last week. You can't really

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Speaker 3: describe a graph very well in a podcast, but let

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Speaker 3: me try. The quickest thing and the quickest way to

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Speaker 3: explain the problem is that housing prices are basically more

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Speaker 3: than tripled in the last twenty years, and you compare

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Speaker 3: that to wages, and wages haven't even doubled, and so

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Speaker 3: the price of housing has been increasing so much faster

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Speaker 3: than what people are earning, and what the cost of

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Speaker 3: a house represents relative to the size of how much

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Speaker 3: we earn and how much most people have saved up

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Speaker 3: is so much larger, and so we have this kind of,

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Speaker 3: you know, really significant housing affordability crisis. It's been growing

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Speaker 3: for a long time. There were points during COVID where

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Speaker 3: we wondered whether that might turn the corner, but it didn't.

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Speaker 3: House prices continued to go out really sharply during the pandemic.

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Speaker 3: We're just starting to see the signs that we might

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Speaker 3: have reached the top of that housing price growth. But

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Speaker 3: we've been talking a lot about cost of living. We've

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Speaker 3: been talking a lot about inflation and the idea that

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Speaker 3: interest rates go up. That's something that's going to make

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Speaker 3: mortgages more unaffordable. It's just a crisis that keeps on

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Speaker 3: going and going, and I think there's a lot of

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Speaker 3: skepticism among young people that they will ever be able

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Speaker 3: to afford a house as a result.

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Speaker 1: I share in that skepticism. But you just alluded to

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Speaker 1: the fact that we might have hit our peak. What

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Speaker 1: indicates that might be the case.

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Speaker 3: Yeah, So we quite reliant on data from private sector

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Speaker 3: companies that monitor house prices to give us a sense

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Speaker 3: of where things are tracking. Two main ones are Core

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Speaker 3: Logic and Domain, and both of them have shown either

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Speaker 3: kind of very very small drops in Melbourne, Sydney and

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Speaker 3: Canberra over the last month or so, or else sort

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Speaker 3: of flatlining in some of the other capital cities. The

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Speaker 3: prices are still going up quite significantly, but it's starting

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Speaker 3: to slow and a lot of the kind of housing

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Speaker 3: market experts and people who watch house prices are suggesting

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Speaker 3: that that has something to do with this sort of

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Speaker 3: inflation issue that we're seeing, and with again the risk

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Speaker 3: that that might lead to higher interest rates. Higher interest

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Speaker 3: rates is they need to go into all the technical details,

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Speaker 3: but the biggest relevance for housing is it makes mortgages

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Speaker 3: more expensive, and so that sort of cooling off interest

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Speaker 3: in the housing market might be why we're starting to

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Speaker 3: get to the crest of this very very large rise.

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Speaker 1: All right now, I don't want to preempt much of

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Speaker 1: the election work we'll be doing in the later weeks,

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Speaker 1: but talk me through what is actually in the hands

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Speaker 1: of the government. What can the government, the government being

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Speaker 1: lower case the government, what can they do to actually

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Speaker 1: fix this crisis? What's within their capability.

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Speaker 3: Yeah, it's a really good question, and I could talk

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Speaker 3: for ten or fifteen minutes about it, but I won't

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Speaker 3: outstate my welcome. I think the quickest way to summarize it,

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Speaker 3: and tda's written lots about this in the past, is

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Speaker 3: that you can look at the demand for housing and

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Speaker 3: you can look at the supply for housing, and people

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Speaker 3: tend to think we've got issues on both sides. So

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Speaker 3: on the demand side, for housing. There's often sort of

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Speaker 3: criticism about how many kind of attractive reasons there are

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Speaker 3: for investors to buy up a lot of housing, and

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Speaker 3: that sort of pushed a lot of demand, not just

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Speaker 3: people who want to buy homes to live in, people

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Speaker 3: who want to buy homes as investment vehicles. That's sort

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Speaker 3: of one of the big issues that's been raised on

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Speaker 3: the demand side. On the supply side, quite simply, you know,

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Speaker 3: it's a question of whether there are enough houses, and

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Speaker 3: that's something that's not just for the federal government. It's

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Speaker 3: sort of you know, state governments and local councils that

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Speaker 3: get involved in nitty gritty planning decisions and that sort

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Speaker 3: of thing that affect the housing supply. So it's a

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Speaker 3: complex issue. It affects governments at many different levels. But

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Speaker 3: there certainly are lots of things on both of those

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Speaker 3: sides that governments can do. And we've had a little

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Speaker 3: bit of discussion about it in this election campaign.

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Speaker 1: Okay, and we're talking about this today, especially because over

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Speaker 1: the Weken Labor announced its new housing policy. Can you

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Speaker 1: just give a quick update on what that policy is

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Speaker 1: and what we can expect from the coalition.

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Speaker 3: Yeah, So it's a policy that's all about the demand

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Speaker 3: for housing from labor that we've heard over the weekend,

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Speaker 3: and it is basically a plan for the government to

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Speaker 3: chip in to buy houses for about ten thousand people,

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Speaker 3: so to chip in forty percent of the value for

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Speaker 3: the house that the government pays and the government owns,

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Speaker 3: and with the idea that that would make housing affordable

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Speaker 3: for the ten thousand people a year who get access

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Speaker 3: to ye.

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Speaker 1: So I was just going to say, so not for

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Speaker 1: everyone making one like the first home bias scheme, it

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Speaker 1: does have a cap to it.

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Speaker 3: It does, so, yeah, ten thousand a year is the

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Speaker 3: cap for that. And I think the easiest point of

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Speaker 3: contrast you mentioned the Coalition there. So the Coalition announced

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Speaker 3: an expansion to its sort of first home buy again

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Speaker 3: demand support in the budget this year, and that's sort

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Speaker 3: of something that they pointed to in response. And that's

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Speaker 3: more about acting as a guarante for a mortgage. So

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Speaker 3: the government basically steps in and says, look, we'll underwrite

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Speaker 3: the mortgage so that this home buyer doesn't have to

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Speaker 3: buy the sort of normal insurance that you do, which

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Speaker 3: sort of takes a little bit off the deposit for

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Speaker 3: a house and they've offered that to about fifty thousand people.

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Speaker 3: It's sort of a slightly I suppose you could say

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Speaker 3: a smaller investment for the government that's available in the

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Speaker 3: coalition's policy to a larger number of people. So that's

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Speaker 3: on the demand side. Labor also has some supply side

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Speaker 3: policies to do with constructing social housing and community in

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Speaker 3: affordable housing, and the Greens have some policies in that

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Speaker 3: area as well, but most of the focus in the

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Speaker 3: housing affordability discussion this election has been on that demand side.

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Speaker 1: It's really interesting and it's certainly something that affects not

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Speaker 1: just young people, but is something that is certainly top

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Speaker 1: of mind for us. We're going to be putting a

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Speaker 1: poll Tom to our audience later this week so that

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Speaker 1: we can understand a bit how they're feeling in the

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Speaker 1: lead up to this election on issues about housing. Until

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Speaker 1: that time, though, I reckon that is all we can

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Speaker 1: discuss on today's episode of The Daily Oz. Thanks for

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Speaker 1: jumping on, Tom, thank you for having me, and if

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Speaker 1: you want to stay up to date on the news

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Speaker 1: of the day, follow us on Instagram at the Daily Ozz.

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Speaker 1: It's where over three hundred and fifty thousand Ozzies get

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Speaker 1: their news every day, and of course we'd love to

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Speaker 1: have you over there as well. Have a wonderful date