Last month the Feds held an economic reform roundtable in Canberra. Housing took centre stage, quite rightly being the key prism to view the twin themes of poor productivity and intergenerational inequality (or bastardry, as Ken Henry would have it).

Every prominent economist, politician and commentator with an opinion on housing got an invite. It was hailed by the pollies as a great success. But those with in-depth expertise on housing and infrastructure weren’t in the room. I graded it F, for failure. FF more likely.

Housing was directly related to at least five of the treasurer's top 10 initiatives. But every proposed solution was yards wide of the mark. Which is as expected if you wrongly define the ‘housing problem’ from the outset. Ask the wrong question, get a misleading answer. As a result, everything you heard about a ‘housing crisis’ is wrong.

Here’s a summary of a series of silly and serious stupidities.

There’s a shortage of supply

The biggest myth: a shortage of housing is causing the crisis. But we have more homes (11m) than households (10m). A million extra. It's not a shortage of supply. We have an abundance. We have a distribution problem. Far too many homes are in the hands of investors, not occupied by owner households.

In their hearts, too many Australians see housing as property, not as homes. Investment, not shelter. Changing that embedded culture is the key problem. A redistribution of housing to those in need would bring about greater equality, but you never hear politicians, benefactors of owning multiple homes, speak about that. Wrong.

Build more homes

That’s the rallying cry. They’ve given it a number. 1.2 million. In five years no less. Do we really need that many more dwellings, and that quickly? How was that target established? What kind of dwellings? And where? Moreover, why? There are no answers, no evidence. Just assertions. And given the imminent failure, the time gets rubbery.

It assumes we have a chronic housing supply problem. But as we can see, we don't. But having established a target, albeit a hopelessly wrong target, the pundits want to fix everything preventing the target from being met. You can see the failed logic straight away. But they didn’t. From that point on, all the suggestions from the roundtable make no sense.

Change the planning laws

First, they point the finger at planning controls. Yes, there's a problem in planning, but not with the controls, but with their application. Yes, planning laws are clunky, overly complicated and difficult, but that's not causing a housing crisis, and changing them will do nothing to fix it. The real failure lies with councils; their cojones gripped by NIMBYs, they fail to staff and administer the controls in a timely and fair manner.

But Councils weren't at the roundtable, and changing their ways is far beyond the abilities of federal and state governments. Australia is plagued by three levels of government, none of which have command of planning, and housing supply in particular. The Feds haven’t had a real interest in our cities and housing since Tom Uren’s DURD in the mid-70s and still don’t. By holding the purse strings, they think they’re off the hook for decisive decisions. And that’s wrong.

Pause the building regulations

While they’re ‘fixing’ things, they suggested freezing and changing the building regulations. That’s a whopper-sized wrong. Ten years ago, conservative UK PM David Cameron tore up the ‘green’ regulations. They got the Grenfell Tower disaster as a result. Do we really want to destroy our record for health and safety in the name of cost-cutting to speed up delivery? The building regulations are vital as guidelines against the all-too-common abominable practice.

Immigration causes the housing crisis

OMG. Does the far right never tire of this Trumpian trope? A little research would go a long way: it’s a false narrative to distract from real causes. In the decade leading up to the current ‘crisis’, the number of residential dwellings increased by 19%, while the population grew by only 16%. The issue is not population growth.

All the research figures go the other way; migration is not out of control and is not to blame for the housing crisis. The opposite is actually true: migrants contribute significantly to the economy by filling skill shortages, boosting economic activity, and ultimately helping to build homes.

More apprenticeships at TAFE

Half right, we don't have the workforce to build even half the 1.2m homes. But TAFE training won't solve it. Successive governments have gutted TAFE worse than universities. And that’s saying something. The roundtable whingers hold the purse strings that could be ripped open to fund TAFE, and ensure apprenticeships are attractive and not one step above slave labour. But they won’t.

We should build with MMC

Modern Methods of Construction are regularly touted as the panacea. Prefab is fab, they say. But you need three things we don’t have: sufficient demand, consumers not squeamish about standardisation, and a fiscal system to support it. Ultimately the Aussie love of individuality, in brick and tile (even as a veneer), dooms us entering the 21^st century.

Build more greenfield houses

They’re supposedly cheaper. But only on the surface. The infrastructure is far more expensive than building within existing suburbs (the missing middle), the car dependency and outgassing go through the (dark tiled) roof, and the distances manifest as isolation and social issues. Very 1950s. And wrong.

Social and affordable housing

We hear endless burbling from politicians and economists about ‘social and affordable housing’. An expression that gives a wholly wrong impression. They’re two, completely, different things.

Social housing is usually provided by the state (rebadged housing commissions), and the renters pay what they can afford as a proportion of their income. Affordable housing is usually provided by a ‘community housing provider’ (a not-for-profit in a market milieu), and the rent is calculated at a percentage below the surroundings.

Social rentals are determined by incomes; affordable rentals are determined by buildings. Same dwellings, completely different process. Full government investment is needed for the former, subsidy can help the latter. Social is the supply shortage we desperately need to address; only 3% of current homes are social; we need 10%. But you never hear investor-politicians talk about their exclusive responsibility to commit money to provide social housing. And that’s wrong.

What’s the real cause, and how do we fix the housing ‘crisis’?

Enough whingeing. What’s the solution? Three things, all tax changes – the very thing that federal politicians control but refuse to act on. 1. Raise more tax; 2. spend more of it on social housing; 3. Remove tax supports for investors and redirect it to owner-occupied homes. It’s the first step to promote homes, not property. Attack inequality. Build better, not more.

You can’t go wrong with that.

More next week.

Cross-Sections are Friday musings from Tone Wheeler, following on from Tone on Tuesday columns. Remember: amateurs draw plans, professionals draw sections; never at cross purposes.

Tone Wheeler

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