Cash Hand Outs Or Real Solution

Politicians at the upper levels of government have failed to deal with the cost-of-living pressures faced by Australians, including all the major components of high inflation such as electricity prices and the high cost of housing.   Rather than deal with the underlying core issues, our elected representatives prefer to wait until an election is looming and then throw cash donations at voters to give the impression of dealing with the core problems.   At the previous federal election three years ago, Anthony Albanese and his colleagues promised to bring down power prices. But electricity costs have continued to rise - so now, with an election due soon, the PM is splashing the cash to give the appearance of action.   This is one of a number of vote-buying measures that are adding to government spending, which adds to inflationary pressures and is likely to see interest rates higher for longer.   And that means impacts not only on families with mortgages but also tenants with higher and higher rents – all of which adds to the inflation spiral.   Three years in government and Anthony Albanese, Jim Chalmers and their pals have failed to make even the slightest dent in all the big issues in real estate.   Housing affordability is the worst ever. Vacancies are at historic lows. Rental affordability is the worst ever recorded. The cost of building new homes is at record levels, with a new house and land package costing close to a million dollars – and over 40% of that cost is government taxes, fees and charges.   Every time a government makes a decision that impacts on these problems, they make them worse, not better.   The Federal Government is now proposing to donate some of our tax dollars to first-home buyers facing that problem of the worst housing affordability ever recorded.   It’s had three years to deal with the fundamental causes of poor affordability, including the hideously high cost of building new homes, but has achieved nothing.   So now they’re bringing on a cash splash, dressed up as a measure to combat poor housing affordability.    But it will do nothing to deal with the fundamental issue, which is the high cost of housing. Indeed, many analysts argue that grants to first home buyers fuel demand and therefore price rises, making the underlying problem worse.   What the country needs, in times of high inflation, high interest rates and high housing costs, is measures to deal with the core problems – not handouts in the lead-up to an election, which is tantamount to putting a band-aid on a broken leg.