Television Interview with Tom Connell – Sky News Newsday – Monday 28 March 2022

SUBJECT: Labor’s Regional First Home Buyer Support Scheme. 
TOM CONNELL, HOST: Last election we had some very different policies from the two major parties on housing affordability. This time around, it seems there’s quite a convergence. The problem, according to the two major parties, one of them at least, is getting a deposit. We’ve got schemes on both sides that aim to help first home buyers get that deposit. Today, an announcement from the government will focus on, first of all, the home guarantee scheme that is, helping first home buyers get a deposit, have to only put 5 per cent in, the government will go guarantee on the other 15 per cent. They’re making this scheme permanent and expanding the number of people that can get it from 20,000 to 50,000. So how much will this help? What will Labor’s response be? Joining me now is the Shadow Housing Minister Jason Clare in the studio. Thanks for your time.
CLARE: G’day mate.
CONNELL: What do you make of this announcement? Good idea?
CLARE: Well, I’m glad that the government’s picked up our idea that we announced on Friday. A regional plan to help first homebuyers in the regions buy their first home. The scheme that the government had in place for the last three years has been a good one, my main concern has been that it’s too small. And over the last three years, we’ve seen prices rise at skyrocketing levels. I think prices have risen by 25 per cent over the course of just the last 12 months. So if you’re a young person out there trying to save a deposit, save a 20 per cent deposit, you’ve seen that get harder and harder over the last 12 months. What you thought was 20 per cent becomes 15. These schemes help because they help a first time buyer get put on an even playing field with other people looking to buy a home, because you don’t end up having to pay that mortgage insurance bill at the end of it, which can cost 20 or 30 grand.
CONNELL: Yeah, not to mention not wanting to perhaps get in at five per cent because you worry about whether or not you can pay off the loan, the loan gets more expensive as well. So, just to walk this back, though, the government started with these schemes, Labor got on board, you announced the broadening of it Friday, you basically seem to be on the same page here right now, around this particular policy.
CLARE: I think both parties recognise that saving up for a deposit is hard and it’s harder now than ever before. It’s harder to buy a house today than ever before. Part of that is you’ve seen interest rates at emergency levels and more people borrowing over the last 12 months than we’ve seen in a long time. But particularly for regional Australia, you’ve seen a lot of Aussies move from the cities to the regions, because they can have a job in Sydney or Melbourne but live in the regions. So while prices have jumped by 21 per cent in the capital cities, on average, they’ve jumped by 26 per cent in the regions. That’s why I made the point, and Albo made the point last week, that it is time for a specific scheme to help regional Aussies buy their first home.
CONNELL: So, the government scheme covers regional Australians as well, would you adopt what the government’s doing today but have a part of the quota thats set aside for regions? Is that what you’d be looking at?
CLARE: My main concern has been that there’s not enough support for people trying to buy their first home.
CONNELL: So where does that leave us? So, 50,000 a year, according to the government, is that enough overall, that you’d set aside some for regional Australians?
CLARE: I think both sides are saying that now. So, it’s good that they’ve expanded the scheme. That’ll help more people. 
CONNELL: So, it’s bipartisan in this aspect?
CLARE: But you do need to make sure, in particular, that you’re helping regional Aussies. Because that’s where we’ve seen those big prices. 
CONNELL: So, you’re both talking about the deposit as the issue. What about the idea that’s come out of the latest housing affordability inquiry, using your equity in super, not pulling it out, the equity in super to help you buy?
CLARE: Yeah, I’ve got an open mind to this, Tom. I think it is different to taking your money out of your superannuation account, you still get the benefit of that compound interest. It’s effectively a mortgage over your superannuation. One limitation, that’s important to note with an idea like this, though, is that the Aussies who need the most help to buy a home, usually don’t have very much superannuation in their account as it is. For the average Australian in their mid 20s, they’ve got on average around about 20 to $25,000 in their superannuation, that doesn’t make for a 20 per cent deposit. 
CONNELL: You’ve got now a cohort in their 30s that feel like they’ve missed the boat. And you’ve also got pretty tight control. I mean, $800,000 is the most you can spend on a Sydney property. That’s not much. So, if you open this up to equity in super, perhaps that’s used for anyone above the 800 and people who feel like they missed out on this first home buyers came in say, ‘Hey, I’m still not in a great position’.
CLARE: Just on that, I think those caps are too low.
CONNELL: They’re too low. What will they be under Labor then? 
CLARE: Well, what we would do if we win the election, and that’s only 30, 40, 50 days away until people start voting, if we win the election, we’ll ask the department to review those price caps immediately and raise them if necessary, so that first time buyers can use the scheme to buy the home they want to buy.
CONNELL: The home you want to buy, would you keep the income test? 
CLARE: Yes. 
CONNELL: And raise just the amount of the home? 
CLARE: Correct. 
CONNELL: Okay, and what do you sort of predicate that on? Would it change if you’ve got two kids because you need a bigger house? 
CLARE: No, it would have to be based in part on the obvious increases in the price of buying a home in the last 12 months. If prices are going up like this, and the price caps have stayed the same, then it tells you that something’s wrong. Let me give you one example. So, up on the north coast of New South Wales, you’ve seen floods ravage that place, but at the same time prices have jumped by 32 per cent in the last 12 months. In places like Byron Bay, the average price of a home there is higher than it is in Sydney. But the price cap under the existing schemes are less than they are in Sydney. That makes no sense to me. That’s why I’ve said, if we win, we’ll review and increase the caps. On top of that, we’ll review and increase them on a six-monthly basis.
CONNELL: And, the government hasn’t actually adopted the super equity idea, but you’re free to.
CLARE: What I’m saying is, I’m in the market for good ideas. I’ve got an open mind to look at it. 
CONNELL: Let’s be simple on it. Does it feel like it’s a good idea?
CLARE: There is no single thing that if you click your fingers, you’re going to fix housing affordability. 
CONNELL: No, but all this other stuff that’s done on getting in via a deposit, this is another deposit idea. 
CLARE: It doesn’t give you the 20 per cent deposit in and of its own right for people on low incomes. That’s why those deposit schemes are important. 
CONNELL: I’ve got that but I’m saying in addition to.
CLARE: What I’m saying is I’ve got an open mind to this, happy to have a look at it. Also got to look at housing supply as well. I know you’ve had Jason Falinski on the program. Part of the solution here is making sure we release more land for people to build homes on. The government when they won office nine years ago, got rid of the National Housing Supply Council, that was a big mistake. Its job was to help fix this problem. The government promised nine years ago that they would release Commonwealth land to be able to develop housing on. They’ve released two sites, one in Queensland and one in Victoria over the last couple of years.   
CONNELL: Could that really be a big part of it, Commonwealth-owned land?
CLARE: I’m not saying that it is the total solution. If we’re serious about this, though, you need federal leadership. What you need is the Commonwealth Government, the state governments and local governments all working together. Believe it or not the housing minister (interrupted)
CONNELL: Similar to what the report essentially found, but what, do you think the federal government can come in and have more of a role?
CLARE: If you’re going to sort of untie this Gordian knot, you need all three levels of government working on it, because all three have a role to play in planning and development. Now, at the moment, the Federal Housing Minister doesn’t even meet with state housing ministers. If we win the next election, we’ll develop a National Housing Plan that will report progress to National Cabinet. Part of it will be looking at this critical issue because if you can get state governments and federal governments and local governments working together, then you’re one step closer to releasing more land.
CONNELL: So the aim of this, your message before we go, your aim on this in terms of house prices, is that they’ve gone, I mean, they’re not affordable anymore. They’re less affordable than the last election when you took some policies and tried to bring them down? Do you need to just start better releases of land planning and so on, so that they can go sideways for a few years? 
CLARE: Anybody who tells you that any policy is going to fix housing affordability, in one fell swoop is not telling you the truth.
CONNELL: No, but when you have at your whole suite – meetings etcetera, is your hope to stabilise prices for a few years?
CLARE: What I’m saying is with a bit of national leadership, you can make it easier for Australians to buy a home, you can make it easier for Australians who want to rent, but you can also build more housing for Australians who don’t have a roof over their head at the moment. That’s what this national plan will do. We’ve committed to taking action to help Aussies buy a home. You’ve seen that over the last few days. We’ve also got a commitment on the table for a $10 billion dollar Housing Australia Future Fund to build 30,000 homes for Australians who are homeless at the moment, women and children fleeing domestic violence. I hope that the government picks up that idea as well. 
Interestingly, Tom, the owners of the Women’s Weekly, and New Idea and Woman’s Day put out some research last week. They surveyed their members, and it found that 86 per cent think the government’s not doing enough to build permanent housing for women in danger, seeking to flee because of domestic violence. And 73 per cent said they’d vote for the party that would do something about it. We’ve got a commitment on it, building more homes than any Commonwealth Government has ever done for women fleeing domestic violence and the government’s policy, to build zero.
CONNELL: We will see, they’ve got tomorrow to decide that. Let me ask you finally, briefly, do you have a message on it where you see house prices, when you talk about all these policies?
CLARE: No one wants to see house prices go down. Everybody that owns a house would be pretty happy with the last 12 months because you’ve seen your equity and your investments go up. But everybody also knows that for people out there that are struggling to buy, it’s getting harder and harder.
CONNELL: What you need, the only message you can really give is, we’ll stabilise them?
CLARE: The message we can give is that we will go to this election with plans to make it easier for you to buy a home. (interrupted)
CONNELL: You’re not going to say the key word, the ‘price’ word is that it? I’m asking whether you’ve got to have an idea in mind as to where these are going.
CLARE: I think everyone wants to see sustainable rises in their investments, right? Whether it’s the home you own, whether it’s your investment property. You’ve seen it go up so quickly that for a lot of Australians they’re thinking about whether they can ever afford to buy a home.
CONNELL: We’ve got to leave it there. I’m sure we’ll be talking about this area again as we head up to a federal election. Jason Clare, thanks for your time.