The Australian housing system and intergenerational sustainability

Summary

This project examined the future of Australian housing in the context of increased concern that future generations may have fewer benefits than do current and past generations. Over the 2006 to 2045 period, the proportion of households experiencing housing costs greater than 30 per cent of their income (that is, in housing stress) is projected to increase marginally from 12 per cent to 14 per cent. Expenditure on Commonwealth Rent Assistance is projected to increase in real terms from $2 billion in 2006 to over $5 billion in 2045 (and from 0.20% of Gross Domestic Product in 2006 to 0.25% in 2045), though expenditure on First Home Owner Grants is projected to decline and offset much of that increase.


Project Number: 60314
Research Theme: Home_ownership, Private_rental, Public_and_Community_housing, Housing_affordability
Project Leader: Kendig, Hal
Funding Year: 2006
Research Centre: Sydney

Research and Policy Bulletin

Research & Policy Bulletin

Issue 099: Is the Australian housing system sustainable?

The current Commonwealth Housing Assistance system is fiscally sustainable in net terms, but only because future higher expenditures on Rent Assistance will be partially offset by lower expenditure on First Home Owner Grants.

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144 KB PDF Document

Description

Research on the financial sustainability of Australian policies has not focused very much on housing or housing policy, even though they are central to matters of intergenerational equity and financial sustainability. The project questioned the capacities needed to continue the substantial benefits that Australians receive from the housing system.

  • Will future generations have the same access to home ownership and public housing?
  • Will low housing costs continue to cushion the effects of income reductions after retirement?
  • What will be the costs of Rent Assistance if the number of private tenants increases substantially?
  • What will be the impacts of inheritance on the housing system and social equity?
  • What would be the costs and sustainability of maintaining current housing assistance and related policies?

The project analysed features of the Australian housing system that have affected intergenerational equity in the past and apply micro-simulation and economic modelling to predict future scenarios.  It identified the effect of various demographic, economic and policy changes on the future including the ageing of the population and growing attention to environmental aspects of land development.

More Information

Download now Final Report: No. 111: Sustaining fair shares: the Australian housing system and intergenerational sustainability
825 KB PDF Document

Download now Research and Policy Bulletin: Issue 099: Is the Australian housing system sustainable?
144 KB PDF Document

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