Housing shouldn’t be a slot machine for the wealthy.

Joan Westenberg
5 min readNov 22, 2023

It shouldn’t be controversial to say this: we are in a generationally catastrophic housing crisis. The data is stark and clear: over the decade leading up to 2023, house prices have witnessed a steep rise across Australia. Specifically, the median price for established houses in major cities like Sydney soared from around $615,000 in the first quarter of 2013 to about $1.2 million at the onset of 2023​​.

The International Monetary Fund has pinpointed Australia as one of six countries exhibiting the highest risk in the housing market, underlining the global recognition of the housing apocalypse.

Surveys by Everybody’s Home have pointed to mounting housing stress amongst Australians, with many renters feeling the brunt of the housing crisis​. Four out of five renters spend more than 30 per cent of their income on housing.

Based on the sombre and weary discussions that ensue whenever Sydneysiders convene, the anecdotal evidence is even more pronounced. We compare notes on rental increases. So-and-so has been given 30 days to move out. There’s black mould covering the wall of a $1,000-a-week rental that used to cost $800, and the landlord won’t spend a cent to fix it.

Discussions between landlords about how much rent they can get away with charging are screenshotted and turned into viral Reddit posts and TikTok videos. The rage is building. Skyrocketing property prices and a scarcity of affordable housing options have created a perfect storm, leaving every demographic, from families to small business owners, without the stability of a safe and secure place to live. Something has to give.

While some blame supply shortages or overseas investors, the primary factor contributing to this crisis is the outsized role of investment properties. Too many individuals and corporations have purchased properties solely for investment purposes, driving up prices and exacerbating the shortage of affordable housing. These investment properties sit idle or are rented out at exorbitant prices, and regular citizens can no longer find affordable homes.

The housing crisis is both an economic and a human rights issue. Housing is a basic necessity for life, health, and dignity. When treated as a speculative financial asset rather than a social good, inequality grows, and vulnerable populations suffer.

To address this crisis, we need bold solutions that answer the scale of the problem. By implementing progressive taxation, incentivizing the conversion of investment properties, and introducing anti-speculation regulations, there is a path to revolutionize the housing market and make affordable housing a reality for all. But it’s going to take fundamental, uncomfortable and unpopular change. Band-aid fixes and minor policy tweaks will not cut it.

The most direct solution is a steeply progressive tax on the value appreciation of investment properties — and the revenue they generate — as high as 50%. This tax would target the property speculation that has inflated housing costs and locked an entire generation out of homeownership. Implementing it would fundamentally reshape the housing market, discouraging financialization and encouraging homes to be lived in rather than hoarded for profit.

Under this proposal, an “investment property” is defined as any residential property not serving as the owner’s single primary residence. Tax rates escalate based on the property’s value or the number of properties owned, with brackets ranging from 10% for properties worth up to $250,000 to 50% for those worth over $1,000,000. The tax would be collected annually, potentially driving down speculative property holding, increasing available housing supply, and generating revenue for affordable housing initiatives.

The message would be clear: housing is a human right for all people, not a commodity for the wealthy to trade. The funds raised through this tax could be transformative — billions invested in affordable housing, tackling homelessness, and community land trusts to keep housing permanently affordable.

On top of a progressive tax on investment properties, we can encourage property owners to turn their spaces into homes that people can afford. Financial carrots, like tax breaks or direct cash subsidies, could make it worthwhile for owners to repurpose their properties. They receive reduced rental costs in exchange for exemption from the new tax. And we can take this a step further by promoting alternative ways of living that build stronger communities, like community land trusts, co-housing, and cooperative housing.

These aren’t just buzzwords; they’re proven models that make housing more sustainable and community-focused. By creating partnerships between the public and private sectors, we can pool resources to speed up the conversion of empty or underused properties into affordable homes. A collaborative approach would make it easier and more rewarding for everyone involved, from property owners to future residents.

There’s a third piece to this puzzle: good, old-fashioned rules and oversight to keep the housing market fair. Putting a cap on how many properties one person can own. Making it tougher to get a loan to flip a house for profit. Guaranteeing loans for home buyers who can demonstrate their ability to make payments without requiring a small fortune as a downpayment. Keeping an eye on investments from outside the country.

Setting up these safeguards ensures that homes stay within reach for everyone, not just those looking to make a quick buck. There’s no need to reinvent the wheel, either. We can learn from places that have already cracked down on property speculation and tailor those strategies to fit the needs of our communities.

Professor Phang Sock Yong points out that over the decades since the 1970s, Singapore’s authorities have been proactive in addressing housing market challenges. Through a series of policy initiatives, they have worked to control speculative activities, stabilize property prices, and enhance the affordability of homes for residents. Eligibility for different housing sectors is determined based on various criteria such as nationality, income, marital status, and whether the buyers are purchasing their first home.

The time for incrementalism is over; the middle-of-the-road policies proposed governments attempting to appease wealthy voters aren’t helping or fooling anyone. We need the political courage to restructure the way housing operates in society. The days of housing as a slot machine for the rich must end. Houses should be homes, not an asset class in an investment portfolio.

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