Neither Labor nor the Nationals would back falling house prices during a heated Sunrise debate on Monday, despite both arguing housing needs to become more affordable. As auction clearance rates fall and house prices soften, Sunrise host Nat Barr repeatedly pressed Social Services Minister Tanya Plibersek and Nationals Leader Matt Canavan, questioning why neither side seems to want housing prices to come down.
Clearance Rates Plummet
The discussion came amid growing concerns about the property market following the federal budget, with the number of homes being sold at auction falling to its lowest level since the early days of COVID. In Brisbane, the clearance rate has fallen from 42 per cent to 33 per cent in the space of a week, while Sydney house prices have dropped by an average of $75,000 over the past three months.
Government's Goal: Slower Growth
Plibersek said the government's goal was not to see house prices continue to fall but instead to slow the pace of growth. "House prices have been growing too fast and that's meant that young Australians haven't been able to afford a home of their own," she said. With house prices now sitting at about 8.5 times the average wage, Plibersek said Australians had struggled to keep up because they had been "competing with property investors".
When asked directly whether the government wanted house prices to fall, Plibersek pointed to varying conditions across different markets. "What we want to see is house prices growing more slowly so that young people can catch up with the market," she said.
First-Home Buyer Schemes
Barr challenged the minister, noting that prices remained well beyond the reach of many first-home buyers. Plibersek said that was why the government had introduced its 5 per cent deposit scheme, which she claimed has helped "over a quarter of a million households into a home of their own". "We've got a $47 billion package, working with the states and territories and local government to provide the infrastructure that we need in new housing estates to make those homes more affordable. We're working closely with state governments for them to reform their planning systems because we know that at local government and state government level, that's where a lot of the delays are and that's where a lot of the costs are. It's not one thing that we're doing, we're making housing more affordable in a range of different ways. An Australia where people can afford to own their own home, that is a really fundamental part of our vision," she said.
Nationals' Stance on Supply
Canavan agreed that housing needed to become more affordable but also rejected the idea of a broader fall in house prices. "The price we see is just the average price. I don't want to see house prices fall across the economy, but I want to see house prices at the lower end of the market with more supply, more affordable housing and more affordable locations increase," he said. Barr quickly picked up on the contradiction. "If there's more supply, the market will drop, the prices will go down," she noted. Canavan argued affordability could improve through increased supply while the broader market continued to grow. "You can have an economy where all boats rise as long as you have a government that has an economic plan to lift productivity and increase wealth," he said.
Barr's Challenge
Barr argued the two politicians were ultimately making the same case with neither wanting "house prices in first home owner categories to go down". Canavan again argued for increased supply, but Barr immediately pushed back. "If you can't afford a house now, you won't be able to afford a house when there's more in the market, unless they go down," she said.
Canavan's Attack on Government
Canavan argued the housing slowdown was a symptom of a much larger problem, accusing the government of damaging business and consumer confidence. "What this government has engineered is an economic crash, a crash in economic confidence which has seen auction rates at record lows," he said. "This budget, by Jim Chalmers, has effectively driven our economy like Thelma and Louise over a cliff, and it's falling down at a rapid rate. The government needs to do something to restore confidence; they ripped up half their budget last week; that's not enough. Everyone wants to fire the liar, but what we've really got to do is drop the flop. Jim Chalmers' budget is a total flop; the prime minister should sack him, get someone in there who actually can come up with an economic plan for our country."
Barr immediately called out the phrase "fire the liar", which has been popularised by One Nation in recent weeks. "I don't care what it is, I want to get rid of this government, they are hopeless," Canavan responded. "I'll work with anybody to get rid of this government."
Debate Descends into Chaos
The debate eventually descended into chaos, with both politicians talking over each other as Plibersek accused Canavan of having "no plan for housing" and voting against affordable housing measures and tax cuts.
