Housing inequity cuts across generations, ACOSS tells Senate inquiry

Older Australians have seen their wealth grow eight times faster than younger generations over the past two decades, but a Senate inquiry has heard housing inequality is no longer just a generational issue.

The Australian Council of Social Service (ACOSS) told a public hearing in Sydney that the issue extended well beyond the divide between younger and older Australians.

“We must pay attention to the vast inequities in housing that are not based on age and that exist within and cut across generations and span across tenure types,” said ACOSS executive director of policy and research Jacqueline Phillips.

“This not just an ownership problem.”

She argued the current housing landscape has been shaped by decades of policy choices, not simply age, saying Australians needed “to look at age and wealth together and recognise the significant wealth inequality within generations”.

The organisation noted it was most pronounced among younger Australians, with the wealthiest 10 per cent of people under 35 owning 25 times the wealth of the lowest 60 per cent.

It argued the figures show that “inequality within generations is widening as well as between generations”.

ACOSS Senior Advisor James Hall said parental support played a “big part of this picture”, noting that in 2010 around 12 per cent of first-time buyers were helped by their parents, compared to 60 per cent as of 2017 and onwards.

“People with parental support are nearly twice as likely to enter home ownership compared to people who aren’t, so that transfer of wealth at that moment is a key part of the story as well,” he told the inquiry.

ACOSS “strongly welcomed” the Albanese government’s housing tax reforms, which targeted negative gearing and the capital gains tax discount, citing independent modelling showing they could reduce home prices by three to five per cent.

“It matches or exceeds the combined efforts of all governments to build 1.2 million homes over five years under the [National Housing] Accord,” Mr Hall said.

The advocacy body said the reforms would also improve rental stability by reducing the incentives for landlords to frequently buy and sell investment properties.

Committee Chair Greens Senator Barbara Pocock said in a statement that the inquiry had heard “powerful evidence” from young renters struggling to make ends meet.

“The current rental market is the most unaffordable in Australian history with some of the highest rates of rental stress,” she said.

“Renters don’t have a buffer — they are the buffer. When interest rates rise, landlords pass the cost straight on.”

In its evidence, ACOSS advocated for governments “significantly” boosting investment in social housing, where rents are capped as a portion of income.

Mr Hall said social housing had accounted for an average of 16 per cent of all new housing construction in Australia since World War II, but that had now fallen to just two to three per cent of new builds.

In 2024, Commonwealth, state and territory governments committed $9.2 billion to deliver more than 13,700 new social and affordable homes through the Housing Australia Future Fund (HAFF), with a longer-term pipeline of 40,000 homes.

However, ACOSS contends the investment is only on track to “briefly pause and do nothing to reverse the decades long decline in social housing stock”.

It’s called on Canberra to set national targets to increase social housing to 6 per cent of all homes within a decade, rising to 10 per cent within 20 years.

“Getting to the 10 per cent would require 54,000 additional social homes a year, so that’s significantly more than the 40,000 over five years under the HAFF,” said Mr Hall.

He estimated achieving the target would require around $20 billion a year in investment.

“While it often seems almost impossible to get there … it’s really important that as part of our target setting, we have unmet need in mind,” he said.

The organisation said around 640,000 low-income households were either in rental stress, homeless, or other forms of housing need, with that figure expected to climb to around one million over the next 20 years.

“There’s always that tension between the feasibility and the level of need, but we need to hold them together quite carefully,” Mr Hall told the inquiry.

Senator Pocock said Labor’s plans to fix the housing crisis “are not touching the sides”.

“After four years of rapidly increasing house prices and astronomical increases in rents, we urgently need solutions,” she said.

“Labor needs to introduce rent caps and invest directly into building good quality homes and renting them to people who need them at prices they can actually afford.”

Mr Hall described the Albanese government’s housing tax reforms as “important progress” but noted it “needed to do more and fast” to address the scale of unmet need.

“They mark a turning point in how we treat housing, as a place for people to live in, as a basic needed right, rather than an asset for wealth accumulation, and the impacts are significant,” he said.