Housing affordability a key issue in Australian elections

Summary

Marketplace Morning Report: Housing Affordability a Key Issue in Australian Elections

Episode Release Date: May 2, 2025

Introduction

In the latest episode of the Marketplace Morning Report, listeners are provided with a comprehensive overview of the pressing issue of housing affordability in Australia, especially in the context of the upcoming elections. Hosted by Liana Byrne and featuring reports from the BBC World Service, the episode delves into the challenges faced by first-time homebuyers, the impact of soaring house prices, and the broader economic implications. Additionally, the report touches upon global market movements and cybersecurity threats affecting major retailers.

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1. Australian Housing Affordability Crisis

a. Election Spotlight on Housing

The episode begins with Liana Byrne highlighting that Australians are heading to the polls in what is being termed a "cost of living election." Housing affordability takes center stage as a critical issue influencing voter decisions.

b. On-the-Ground Report from Melbourne

Vivian Nunes reports from Melbourne, emphasizing the drastic rise in house prices over the past two decades. The pandemic has exacerbated the situation, causing rents to surge and making it nearly impossible for many young Australians to save for a home deposit.

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2. Insights from the Real Estate Market

a. Interview with Real Estate Agent Daniel [01:19]

Vivian Nunes interviews Daniel, a real estate agent, at a property in Box Hill. Daniel describes the property as a mid-century 1960s building with three bedrooms and a private courtyard, priced between 550,000 and 600,000 Australian dollars (approximately 380,000 USD). He underscores the difficulty for first-time buyers to enter the market, especially in desirable suburbs with adequate facilities and infrastructure.

Daniel: "It is difficult for first home buyers to get into the market in these inner city fringe sort of suburbs with the better facilities and infrastructure and transport and schools and the likes." [01:42]

b. Personal Struggles of Potential Buyer Chanel [02:04]

Chanel, a 32-year-old professional, shares her personal challenges in affording home ownership. Despite having a decent job, she finds it extremely difficult to balance rent and savings for a deposit in her preferred area.

Chanel: "I am definitely feeling that myself. I have a pretty decent job but still being able to sort of afford rent and all of the expenses and then Being able to save that deposit, buying within the area that I'm keen to buy in is extremely challenging." [02:04]

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3. Expert Analysis on Housing Shortages

a. Brendan Coates of the Grattan Institute [03:03]

Housing expert Brendan Coates explains that Australia's housing shortage stems from insufficient construction to meet a growing population. He highlights that Australia is one of only four OECD countries where housing per person has declined over the last 20 years.

Brendan Coates: "Australia hasn't built enough homes to meet the needs of a growing population... most Australians live in our five major cities. Which means that if we don't build enough homes in those cities, then housing becomes increasingly expensive." [03:03]

b. Impact of Population Concentration

Coates points out that despite Australia's vast landmass, the concentration of population in major cities without corresponding housing development has driven up prices, making homeownership unattainable for many.

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4. Demographic Shifts and Voting Patterns

Vivian Nunes notes a significant demographic shift in the electorate, with millennial and Gen Z voters outnumbering the baby boomer property owners for the first time. This shift intensifies the competition among political parties to address housing issues and win over younger voters.

Vivian Nunes: "This election marks the first time millennial and Gen Z voters outnumber the property owning baby boomers. Both sides of politics are desperately trying to win over younger voters." [03:31]

By the weekend's conclusion, the election results will reveal which party has successfully addressed the concerns of these younger demographics.

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5. Global Market Updates

a. Hong Kong Stocks and US-China Trade Tensions [03:51]

Liana Byrne reports that Hong Kong stocks reached a near one-month high as easing tensions between the US and China provided a boost to the markets.

b. Shell's Quarterly Profits [03:51]

Oil giant Shell announced quarterly profits of nearly $5.6 billion, a decrease from the previous year but still exceeding expectations.

c. Japan's Trade Negotiations with the US [04:40]

Professor Yoko Isakura from Hitotsubashi University discusses Japan's efforts to negotiate trade terms with the US. Despite challenges due to Japan's significant trade surplus, the focus remains on enhancing trade and economic security ties.

Yoko Isakura: "I think it's much more depending upon the consumers. If consumers want American cars, they will buy... More of the US, particularly rice. We have such a shortage of rice in Japan..." [04:40]

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6. Cybersecurity Threats to UK Retailers

a. Recent Cyber Attacks on Major Retailers [05:22]

Zoe Kleinman reports that the luxury department store Harrods has been targeted by a cyber attack, following similar incidents involving the Co Op and Marks and Spencer. These attacks have prompted retailers to heighten their cybersecurity measures to protect customer data and maintain business operations.

b. Interview with Nick Stowe of Monsoon and Accessorise [06:23]

Nick Stowe discusses the constant threat of cyber attacks faced by retailers. He emphasizes that while high-profile attacks aim for financial gain, the potential disruption can severely impact businesses.

Nick Stowe: "I think people don't realize that, but it's a constant issue for us... They might have some core celebs, but I think this is about money... We wouldn't pay a ransom and I think most people would be in the same boat." [06:23]

Stowe advises organizations to remain vigilant and proactive in their cybersecurity strategies to mitigate these ongoing threats.

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Conclusion

The Marketplace Morning Report episode sheds light on the critical issue of housing affordability in Australia, highlighting the struggles of first-time buyers and the broader economic factors contributing to the crisis. As the election approaches, the outcome will likely hinge on how effectively political parties address these concerns. Additionally, the report underscores global economic movements and the increasing cybersecurity challenges faced by major retailers, painting a comprehensive picture of the current business and economic landscape.

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Notable Quotes Recap:

• Daniel (Real Estate Agent): "It is difficult for first home buyers to get into the market in these inner city fringe sort of suburbs..." [01:42]

• Chanel: "Buying within the area that I'm keen to buy in is extremely challenging." [02:04]

• Brendan Coates: "Australia hasn't built enough homes to meet the needs of a growing population..." [03:03]

• Yoko Isakura: "If consumers want American cars, they will buy... We can still have quite a bit of potential to import." [04:40]

• Nick Stowe: "They might have some core celebra, but I think this is about money... We wouldn't pay a ransom." [06:23]

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This detailed summary provides an overview of the key discussions, insights, and conclusions presented in the episode, offering valuable information for listeners and those interested in the intersection of housing affordability and economic trends.

Transcript

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[Liana Byrne]

House prices on the up dominates election day down under hello, you're listening to the Marketplace Morning Report and we're live from the BBC World Service. I'm Liana Byrne. Good morning. Australians head to the polls tomorrow in what's being called a cost of living election. With housing front and center, house prices there have soared over the past two decades. Since the pandemic, rents have shot up too, making it nearly impossible for many young people to save for a deposit. The BBC's Vivian Nunes reports from Melbourne.

[Vivian Nunes]

Housing issues are front and center of this election campaign and I've come to a property that's open for inspection in Box Hill that's just about half an hour outside of central Melbourne. And I'm here with the real estate agent Daniel. Thanks so much for letting me come and have a look at this house. Tell us about the property first of all.

[Daniel (Real Estate Agent)]

Well, this is a mid century 1960s build, I call them old walk up apartments with double carport, three bedrooms. It is first floor but it has a private little courtyard. We anticipate this will sell somewhere between around 550 and $600,000. Ideal for sort of your first home.

[Vivian Nunes]

Buyer market around $600,000 Australian. We're talking about 380,000 US how hard is it for first home buyers that you see coming in?

[Daniel (Real Estate Agent)]

It is difficult for first home buyers to get into the market in these inner city fringe sort of suburbs with the better facilities and infrastructure and transport and schools and the likes. 600,000 Australian dollars is a substantial amount of money, particularly when the home really could undergo a major renovation in order to get it up to today's living standards.

[Vivian Nunes]

I think we've got a prospective buyer coming in so I'll let you go and have a chat.

[Daniel (Real Estate Agent)]

Thank you.

[Chanel]

My name's chanel, so I'm 32. It is challenging for people to get into the market at this point and I'm definitely feeling that myself. I have a pretty decent job but still being able to sort of afford rent and all of the expenses and then Being able to save that deposit, buying within the area that I'm keen to buy in is extremely challenging.

[Vivian Nunes]

Most banks want a 20% deposit before they'll sign off on a loan. That means young people need to save around 120,000 Australian dollars for an average entry level home. For many, that's an astronomical figure. And saving it all is out of the question since rental costs in Australia's capital cities have risen far faster than incomes since the pandemic. So how did Australia get to the point where working couples are unable to afford a home without moving in with mum and dad? Brendan Coates is a housing expert at the Grattan Institute, a think tank in Melbourne.

[Brendan Coates]

The reason is because Australia hasn't built enough homes to meet the needs of a growing population. And so Australia is only one of four countries in the OECD where housing per person has gone backwards over the last 20 years. We actually have some of the least housing per person of any country in the oecd. So despite being an island nation with an enormous landmass, most Australians live in our five major cities. Which means that if we don't build enough homes in those cities, then housing becomes increasingly expensive, which is what we've seen in Australia.

[Vivian Nunes]

This election marks the first time millennial and Gen Z voters outnumber the property owning baby boomers. Both sides of politics are desperately trying to win over younger voters. By the end of the weekend, we'll know which party was more convincing. I'm the BBC's Vivian Nunes for Marketplace.

[Liana Byrne]

Now let's do the numbers. Hong Kong stocks hit a near one month high on Friday as signs of easing US China trade tensions gave markets a lift. And the oil giant Shell posted quarterly profits of almost $5.6 billion. That's down from last year, but still beating expectations. Meanwhile, Japan's top negotiator says talks in Washington have been constructive as Tokyo tries to avoid any steep new tariffs. Japan is facing some of the highest proposed duties because its big trade surplus with the U.S. officials say discussions focused on boosting trade and strengthening economic security ties. But Yoko Isakura, professor emeritus at Hitoshi Bashi University, says a trade deal will only succeed if Japanese consumers are willing to buy U.S. goods.

[Yoko Isakura]

I think it's much more depending upon the consumers. If consumers want American cars, they will buy. But the government cannot force the Japanese consumers to buy American cars if they don't like it. But when it comes to the agricultural products such as soybeans and things, we can still have quite a bit of potential to import. More of the us, particularly rice. We have such a shortage of rice in Japan and rice is a staple food, but the price has gone up like crazy. So I know the trading companies in Japan started importing some of the US made rice.

[Liana Byrne]

That was Yoko Isakura, professor emeritus at Hitotsubashi University. Now here in the uk, the luxury department store Harrods has been targeted in a cyber attack. It comes days after two other retail chains, the Co Op and Marks and Spencer, were also hit. The BBC's technology editor Zoe Kleinman reports.

[Zoe Kleinman]

Harrods became the latest retailer to take measures to contain an attempted cyber attack yesterday by restricting Internet access at its sites. It said it's on online shopping service and stores were unaffected. Businesses are bombarded by attempted cyber attacks all the time, and it's not yet clear whether recent incidents are connected. But retailers are currently on high alert since a ransomware attack hit Marks and Spencer and is still affecting it several days later.

[Liana Byrne]

Zoe Kleinman there. Now analysts suggest retailers are a target because of the customer data they hold and the high impact that any disruption can have. Nick Stowe is chief executive of the fashion chains Monsoon and Accessorise.

[Nick Stowe]

We're targeted constantly, and I think just along with most of the other retailers, there are attacks that go on in various shapes and forms all the time. I think people don't realize that, but it's a constant issue for us. I think they generally want money. They might have some core celebra, but I think this is about money. The challenge with some of these attacks is it can completely sink the business. I think our going in principle is we wouldn't pay a ransom and I think most people would be in the same boat. I think how you navigate that when it's actually happening is probably another matter. We haven't had to cross that bridge yet.

[Liana Byrne]

Nick Stowe there on the UK's National Cybersecurity center, says all organizations in the UK need to be vigilant against cyber attacks. I'm Liana Byrne with the Marketplace Morning Report from the BBC World Service.

[Janelie Espinal]

If there's one thing we know about social media, it's that misinformation is everywhere, especially when it comes to personal finance. Financially inclined from Marketplace is a podcast you can trust to help you get serious about your money so you can build a life you've always dreamed of. I'm the host, Janelie Espinal, and each week I ask experts important money questions, like how to negotiate job offers, how to choose a college that you can afford, and how to talk about money with friends and family listen to Financially inclined wherever you get your podcast.