Just as there's no universal housing affordability crisis, there's no one-size-fits-all solution

Let’s accept that in some areas we have a serious problem with housing affordability.

As to whether we have a crisis that depends largely on where you live and how old you are. However, chances are that if you’re under 25 or 30 and living in Sydney or Melbourne, you probably don’t yet have a mortgage and looking at rapidly escalating prices don’t hold out much hope of ever achieving the status of home owner in these cities.

The trouble with Australia’s housing affordability crisis is that the pain is not evenly distributed. If you had the benefit of purchasing before the current Sydney/Melbourne bull run you are most likely benefiting from historically low interest rates and increased equity, making second or third home property investment an attractive proposition.

There is no affordability crisis for this group other than concern for the future property aspirations of any offspring.

So any crisis is about accessibility and the prospect that a generation of younger Australians in our major capitals may be locked out of home ownership for their lifetime or suffer extreme hardship to get a foot on the property ladder.

And to make their lot even tougher, they are caught in a vicious cycle where there is a limited supply of private rental accommodation and prices are at an all-time high.

Not to be confused with housing affordability we also face challenges in regard to affordable housing.

Much of the public commentary around the issue displays a failure to understand that these are two quite different issues. Affordable housing encompasses a range of housing options including Government owned and allocated public housing, social housing often supported by charities, and privately owned low-cost housing often integrated as part of a mixed broad scale residential precinct development.

The supply of affordable housing has been gradually declining over many years pushing many low income families into the private rental market where they must compete against those on higher incomes.

Historically, the provision of affordable housing to support those in need has largely fallen under the remit of our social welfare systems, either at a federal or state level. As the pressure on the public purse grows, it is clearly time to think about new ways to deliver affordable housing through different sorts of government, private sector or individual investor partnerships.

For the private rental sector to assist in resolving the affordable housing issue we need to stop taking pot shots at investors or blaming overseas investors for pushing up prices beyond the reach of young Australians.

The investor market has been critical to Australian housing supply for decades, and it will be even more important in the future as the ability of governments to fund the needs and expectations of our society is placed under growing pressure.

If supply is the remedy to housing affordability then let’s get on with it.

Banks changing their rules about lending to investors only undermines the efforts to increase housing stock in areas where there is high rental demand. So too the withdrawal of finance to developers in key locations, the production of blacklists in areas where supply has finally caught up with demand, and the onerous restrictions on lending to buyers of smaller apartments.

These measures might be billed as levers to slow house prices but their effect is just the opposite. Banks enjoy an incredible level of support from government but part of the compact must surely be to support the aspirations of their customers, not only their shareholders. Changing the rules and pulling the plug on settlements does not rate as good corporate behaviour.

The problem with much of the current commentary is that it suggests there is a simple solution to a complex problem. Just as there is no single Australian real estate market, there is no universal housing affordability crisis.

There are clearly major barriers for first home buyers wanting to purchase in Sydney or Melbourne, and given the population increases projected and associated demand for housing over the next 20 years, there’s unlikely to be much change for these cities without major market manipulation, which our collective governments are unlikely to undertake.

The ongoing and often shrill calls to curtail negative gearing as a panacea for all of our challenges also needs to be resisted for the fact it will produce a range of unintended consequences that will only harm recovering markets in cities such as Brisbane and the Gold Coast, and struggling regional areas where permanent population drift is hurting local economies and the local property markets.

Any changes to the property taxation arrangements that are designed to limit the growth of markets that have experienced 25 per cent to 30 per cent capital growth over the last two years are likely to result in declines in the many areas of our country where price movement has been marginal or negative.

If you’re an owner-occupier in regional Australia who has never had the ability or desire to invest in a second property, you’d feel justifiably aggrieved if your only significant asset dropped in value as a result of policy changes whose main aim was to assist or placate home purchasers in Sydney and Melbourne.

Those who have taken advantage of negative gearing to buy investment property come in many guises. Along with the mum and dad investors, many of whom have purchased to assist their children, are first home buyers who have got a foot in the door thanks to the tax concession. Why not make it easier still for first time buyers by removing the requirement to live in the property without compromising their First Home Buyer subsidies.

If changes are to be considered to the investment foundations of our property markets, they need to be carefully tailored to address specific challenges.

We need to start talking seriously about greater access to superannuation savings for home ownership, postcode-based regional modifications and restrictions to capital gains tax and negative gearing arrangements, replacement of government stamp duties with broader based property-based duties, increased provision of affordable housing in all new developments but especially where government is the landowner, security of tenure for long-term tenancies and reining in the outrageous windfalls that come with government rezoning of land.

We are well past the stage when we looked to government for cradle to grave security. Nonetheless, ingrained deep in our psyche of what it means to be Australian is an expectation that we care for those least able to support themselves.

In this respect we need the government to continue to provide affordable or social housing for the many thousands who through life circumstance or disability require support throughout their lifetime.

But we also need government and institutions to support and encourage the supply of new homes whether that be for purchase by investors or owner occupiers. It is low to middle income earners who will suffer most when a slowdown in investment pushes up the price of private rentals.

Andrew Cocks is the managing director of real estate agency Richardson & Wrench.