In the minds of Australians, the term “Australian dream” is even more firmly associated with homeownership than the term “American dream” is in the minds of Americans. For more than a century, Australia has enjoyed higher homeownership rates than the United States.
Yet now the Australian dream is nearly dead thanks to state land-use restrictions that have made Australian housing some of the most expensive in the world. According to Wendell Cox’s housing survey of English-speaking countries, Sydney, Australia is the second-least affordable urban area, with only Hong Kong being less affordable. Hong Kong at least has an excuse of somewhat limited land area.
Some blame the housing crisis on the “concentration of wealth,” when in fact the opposite is true: by making housing expensive, the government has concentrated wealth in the hands of existing homeowners at the expense of renters and recent and aspiring homeowners. Others suggest that Australians should dream about something else, as if there is little anyone can do to ever make housing affordable again.
In fact, it is somewhat ridiculous that urban planners have been given the power to make housing unaffordable in one of the lowest-density countries in the world. Australia has about 90 percent of the land area of the contiguous 48 states but less than 8 percent of the population. More than 89 percent of Australians live in the quarter of a percent of land that is considered urban. Despite Australia’s reputation as a big desert, more than half the country is considered suitable for agriculture, yet less than 6 percent of that agricultural land (around 3.8 percent of the nation as a whole) is needed for growing crops. Urbanization is clearly no threat to farm production.
One person who understands the housing crisis is Senator Bob Day. As former president of the Housing Industry Association, Day understands that the costs of sprawl are often imaginary while the costs of controlling sprawl are huge.
Sadly, Day’s party (Family First) has just one seat out of 76 in the Senate. But perhaps Day can use public agitation about the nation’s housing crisis to persuade parliament to pass national legislation overruling the state land-use laws that have destroyed the Australian dream.