00:01The centrepiece of the budget was tax reform to improve housing affordability, which was
00:06either a courageous or deceitful broken promise, depending where you stand.
00:11It wasn't necessary though because the National Housing Accord plan to build 1.2 million dwellings
00:15by June 2029 isn't working.
00:18There are 120,000 behind already and not much chance of catching up.
00:22And there are two problems.
00:24First, the accord is about approvals.
00:27And that's not the problem.
00:28They are falling short of target, but a lot more houses are being approved by councils
00:33than are being built, which is disguised by a statistical quirk.
00:38The ABS doesn't collect development applications data, only construction certificates, which
00:43is the final step before building starts.
00:46Now discussions with the industry and councils suggest each state is sitting on at least 100,000
00:52approvals that aren't getting built, so about three quarters of a million houses and flats
00:55look stranded because the development can't make the project stack up.
01:00The second thing is that population growth is not falling as expected.
01:04In fact, it's rising.
01:07The latest data for net overseas migration is for September last year when migration and
01:12population growth both increased.
01:14Now, more recent data on long term arrivals suggests it continues to rise.
01:19So in the budget, Treasury has had to increase its forecast for it.
01:23But it is still saying that migration will fall to 225,000 in two years time, or about 100,000
01:30fewer than last year.
01:32Now, if that forecast comes true, then the current level of housing completions will more than
01:38meet demand and bring house prices down.
01:41But for some reason, the government won't turn that forecast into a target.
01:47The oppositions, both of them, are talking about migration targets and it's now a key political
01:53battleground.
01:54Well, maybe that's the next bit of courage that's needed from the government, turning its
01:59migration forecasts into targets.
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