Australia’s Housing Crisis Could Take a Generation to Fix
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Falling property prices alone will not solve Australia’s housing affordability crisis, a federal parliamentary committee has been told.
NAB chief economist Sally Auld said the problem had developed over decades and could take at least 20 years to address.
Speaking to the Senate committee on Thursday, Auld identified limited housing supply as the main cause. She also pointed to strong demand, lower interest rates, tax settings and rising construction costs.
House prices have increased far faster than wages since the early 2000s. As a result, home ownership among Australians under 40 has fallen to its lowest level since the 1950s.
Auld said higher interest rates, government tax changes, the impact of the Iran war and increasing building costs were adding to the pressure.
Chief economists from ANZ, Westpac and Commonwealth Bank also told the committee that significantly increasing housing construction was essential.
ANZ chief economist Adam Boyton said planning laws and tax policies had created obstacles over many years. He said Australia needed to build homes faster and on a much larger scale to meet the needs of its growing population.
Meanwhile, major banks have revised their interest rate forecasts.
CBA and ANZ expect the Reserve Bank to raise the cash rate by 0.25 percentage points in November 2026. NAB is forecasting a possible increase as early as September, followed by another hike in November.
Westpac remains more cautious. It expects the next rate move to be a 0.25 percentage point cut in August 2027.
Stay tuned with Aus News Lanka – the leading platform for news for Australians.
Source : 9 News
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