RORY SALAZAR | Finance | Contact
Thirty-six months ago, the federal government engaged Betoota-based housing think-tank, the Australian Institute of Dwellings (AID), on a lucrative contract to solve the housing crisis once and for all. For three years, the group of experts met weekly to investigate the problem and find the solution. To tackle the issues, they drew from their wealth of knowledge collected from numerous university degrees, including economics, public policy, urban development, finance, and one Certificate IV in Fitness. These skills, combined with their decades of lived experience in various real estate fields such as detached dwellings, apartments, dual occupancies, manor houses, boarding rooms, worker accommodation, and seniors housing.
Armed with these elements, the experts systematically worked through the issues using digital AI tools to help them run scenarios of how their solutions would work in the real world. Their first idea was to make renting more affordable through rent capping. However, when that scenario played out, it became a huge disincentive to property investors, which led to a vastly reduced number of rentals available while also causing rent bidding to increase.
Then they tried removing the planning system altogether to allow more residential land supply to flow into the market immediately. However, this led to environmental collapse from endless sprawling fields of subdivision estates with no houses on them. There simply weren’t enough tradies or materials to build enough houses to satisfy demand.
So they removed all transaction costs, including stamp duty, but that saw the property sector heat up, and prices rise exponentially as investors began trading properties weekly as though they were companies listed on the ASX.
It took AID three years to run scenarios for every single possible solution. With each solution came even more problems. This led the experts to agree on the only conclusion left and submitted their report to the government on the 15th of this month. The AIDs expert report that was three years in the making, and cost taxpayers $235 million to produce, ended up being a one-page document with a single-sentence conclusion:
“There’s literally no way to un-fuck this.”
