In a recent social media post, Housing Minister Clare O’Neil shared a video in which she spoke about the “broken housing market” and how it was hurting Australians.
There is a full transcript of the video at the bottom of the article.
O’Neil went on to state that:
“You’re either on the side of change and you’re on the side of first home buyers or you’re the last man standing defending a broken housing market in our country.”
This is rather an ironic twist on the narrative from O’Neil given her previous commentary on the issue.
In December 2024, O’Neil was interviewed by ABC’s Triple J and stated in no uncertain terms that the government wanted continued rises in housing prices.
https://x.com/AvidCommentator/status/1866282913308062175
Here is a transcript of the relevant part of the interview.
Interviewer:
What is the goal here in terms of these policies? Is it to bring down house prices?
Clare O’Neil:
We want to bring housing price growth into something sustainable. So we are not trying to bring down house prices.
But we don’t want to see some of the growth that we’ve seen in some parts of the country, where you are getting double-digit increases in house prices year-on-year.
Interviewer:
Why don’t you want to see house prices drop? Because if you’re a young person looking at what’s ahead of you, you definitely want to see house prices come down.
Clare O’Neil:
Well, that may be the view of young people. That’s not the view of our government. We want to see sustainable price growth…
Interviewer:
But minister, if house prices don’t come down. Doesn’t that this system is stacked against young people. And it is just not going to work for them?
Clare O’Neil:
Our government’s policies are not going to reduce house prices and we want house prices to grow sustainably.
Since then housing prices have increased dramatically and hopes of a recovery from the rental crisis have been dashed.
Multiple journalists have sought clarification from the government on what “sustainable price growth” is, but it has yet to be put in writing.
While housing prices are now falling, there are multiple government policy settings still working to support the market such as, high migration, shared equity scheme and the 5% deposit scheme, amongst others.
In effect, the government is both giving and taking away when it comes to their effect on housing demand.
Overall, it could be argued that the current net effect is on balance negative, but that is largely due to the impulse putting upward pressure on prices stemming from the previously implemented interventions running out of steam even before the federal budget.
The Takeaway
While lower housing prices and improving housing affordability are welcome developments, the Albanese government is attempting to have the issue both ways politically.
On one hand there are supporters of the government celebrating the government’s bravery in putting downward pressure on prices through its changes to negative gearing and the capital gains tax discount as they relate to existing housing.
On the other, the narrative that the government’s goal is consistent “sustainable” house price increases remains the party line, despite the recent acknowledgement from within the government that the market is undergoing a “correction”.
Ultimately, it will take quite a long duration of falling prices for the damage Labor has done to housing affordability during its time in office to be cancelled out, let alone the damage that occurred under the Coalition.
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Transcript of O’Neil’s recent video from social media.
“You must be blind if you cannot see how much our broken housing market is hurting Australians.
How can you be coming into this house again and again defending the status quo and saying that nothing needs to change?
A low-income young person in our country today is half as likely to own their own home than they were in the year that I was born.
And you know what those opposite want to do about that? Precisely nothing.
You’re either on the side of change and you’re on the side of first home buyers or you’re the last man standing defending a broken housing market in our country.”
