THE GREAT DIVIDE: Australia's Housing Mess and How to Fix it
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After Hong Kong, Sydney’s median house price is the second most expensive on earth.
The hike in house prices is a sting that has transformed Australian society by escalating disparity and altering the relationship between generations. It was in the 21st century that things went seriously wrong, with a huge rise in the price of housing.
It’s no wonder, then, that one of the great mysteries of Australian life is that a land of sweeping plains, with one of the lowest population densities on the planet, has a shortage of land for houses.
Alan Kohler, a former editor of The Age and The Australian Financial Review, provides an in-depth analysis, stating “the solutions are both complex and simple, difficult and easy: supply must be increased and superfluous demand reduced”.
“The growth in the value of Australian land has fundamentally changed society, in two ways. First, generations of young Australians are being held back financially by the cost of shelter, especially if they live somewhere near a CBD and especially in Sydney or Melbourne; and second, the way wealth is generated has changed.
“Education and hard work are no longer the main determinants of how wealthy you are; now it comes down to where you live and what sort of house you inherit from your parents. It means Australia is less of an egalitarian meritocracy.”
In this sharp, illustrative and progressive essay, Kohler tells the story of how we got into this mess – and how we might get out of it – complete with graphs.