"Zoning and planning regulations that limit the supply of new housing increase the price of housing. For instance, Kendall and Tulip (2018) estimate the impact of zoning on housing prices and find that “as of 2016, zoning raised detached house prices 73 per cent above marginal costs in Sydney, 69 per cent in Melbourne, 42 per cent in Brisbane and 54 per cent in Perth”
From
An open secret. So, if we progressively change zoning, then a large part of the synthetic component evaporates? Apartments in NSW are a joke with over 53% needing remediation. So the planning laws don't work to create good housing. What are they really for?
Interesting that you say you've moved your RnD business to Japan. I'd imagine the barriers to movement from Aus to Japan for a whole business would've been huge!
But yeah, the run up in housing might have been sustainable if the wages kept up, but they didn't. And then the Liberals have had a god awful general policy of keeping wage growth low. To have high house price growth and low wage growth is just incongruous, they had to pick one or the other or face the circimstances we're in now.
Aus puts plenty of effort into advancing technology, its the capitalisation on that technology we have trouble with. An exception to that is our mining technology, for instance, its probably world leading. But plenty of other areas where we can't/won't capitalise because mining and care sector suck up so many of the nations resources. Its a choice we've collectively made there, i'm not sure if its correct or not.
But i'd definitely feel more comfortable with a more widespread base of production and competitiveness.
From an ABC article today.
"Independent property economist Cameron Kusher argues there needs to be a "paradigm shift" in the way Australians view housing, "away from one in which you build wealth from buying and holding residential property to one in which it is seen as essential shelter".
Yep, thats more along the lines i'm thinking.
Two ways i can see a political opening for the shift happening,
An argument is put forward that has broad resonance, changing and solidifying the public opinion.
In two or three federal elections the losers of the current system will far outweigh the winners. Assuming our democracy remains as democratic as it is now, or more so, the sheer numbers of negatively impacted will demand action.
Great points. I can't see number 1 bring over the boomers anytime soon. I concur with point number two. But I will be long in the tooth by the time this comes to fruition. Moving to a country that has sensible housing policies side steps the whole issue for me. I understand this isn't an option for everyone, and feel for them being trapped somewhat.
Probably right about the first option, but i feel like more progress has been made with older generations recognising its a particular problem.
I'm interested to find out what Japanese people think of the way their housing system was transformed way back. Have you spoken to any of the older people about the experience?
I can't remember where i saw it explained recently, but apparently it was a pretty authoritive regime they instigated to transform the system.