On home ownership

For more than a century, Australian housing policy has been built around a simple idea: owning your own home is a good thing. Not only for the household but also for society as a whole.

That belief shaped government policies, and it explains much of how our cities were planned, financed and built.

For most of the twentieth century home ownership was not just a lifestyle choice, a market outcome or a personal brand; it was social infrastructure that gave stability. Governments believed stable households made stable communities, and widespread ownership underpinned democracy, productivity and social cohesion. Policies were built around that idea.

Whilst we still talk about ‘the great Australian dream’, our current policy settings tell a different story. Housing has shifted from shelter to asset, from home to property investment.

The consequences of that shift are now evident: declining ownership, rising rents, entrenched inequality, and a generation locked out of ownership, not by preference but by design.

We face a very simple question: do we believe that everyone should own a home, or are we comfortable treating housing primarily as property?

Why is home ownership a good thing

Home ownership delivers benefits in ‘the triple bottom line’: bringing social, environmental and financial benefits.

A home is shelter. It provides security, stability, identity and a sense of belonging. It gives dignity and a base from which people participate in a community and society generally. A home as the ‘third skin' – after our own skin and clothing – anchors families and supports mental health.

Ownership fosters a sense of agency and civic pride. It provides protection against arbitrary displacement as a temporary occupant and housing stress in the rental market and allows people to plan their lives beyond the next lease renewal.

Environmentally, building performance and suburb-wide resilience depend on the stability of ownership. An owned home will always be better maintained than a rental.

Owners have the incentive to invest in long-term performance: to install insulation, double glazing and solar panels – upgrades that improve comfort, reduce energy use, improve climate resilience and reduce the carbon footprint of the suburb.

By contrast, in a rental-dominated property market, investors are focused solely on short-term yield, where sustainability improvements are ignored, leading directly to a lack of care for the physical fabric of our cities.

Economically, home ownership enables households to build modest wealth over time without speculative risk. It allows owners to borrow against it for health, education, and lifestyle.

Despite superannuation increases, the home is the primary form of retirement saving – a store of wealth for later life. By contrast, renters fund the capital gains of others, while they accumulate nothing themselves. Every household pays a mortgage – but one third pay someone else’s.

Home ownership in Australia

Home ownership enjoyed long political support in Australia. At Federation, around 50% of Australian households owned their homes, then the highest rate in the world. After WW2, support intensified; by the 1970s, over 70% were owner-occupiers.

This was not accidental or because Australians were unusually virtuous or thrifty. Government policy encouraged ownership through land release, infrastructure investment, banking policy, accessible mortgage finance and tax arrangements. We didn’t treat speculation as a national sport.

Robert Menzies famously framed it as a defining aspiration of the “forgotten people”. Labor governments, supported ownership through large-scale lending programmes and infrastructure provision. The parties disagreed on many things, but the value of ownership was never questioned.

But tax incentives for property investment (negative gearing and capital gains discounts) mean we no longer support ownership for all, and the rates are falling below 66% and continue to trend downward. The decline occurred gradually, over several decades, reflecting a shift in policy priorities rather than changes in household preferences.

Australia’s home ownership rate is now lower than the OECD average, comparable with the USA and UK but lower than many European and Scandinavian countries, whilst those with lower rates offer rental systems with long-term security and strong institutional protections.

Our country, once recognised for widespread ownership, is now a laggard.

What now?

We need to decide if we are a society that values homes or an economy that prioritises property. Home ownership delivers clear social, economic and environmental benefits; owner-occupied homes bring stability and sustainability. Home ownership must be the central objective of all housing policies.

Everything flows from that philosophy, every current setting must be questioned, and everything that follows in this series rests on that choice.

‘Housing Australia – Noun + Verb' is a forthcoming book by Tone Wheeler, collecting fifty years of work on philosophy, policies, projects, planning, processes and the practice of housing.

Tone Wheeler

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