ANZ CEO Shayne Elliott recently stated that home loans are now the “preserve of the rich” as housing prices continue to grow, making it difficult for everyday Australians to afford. He indicated that Australians looking to buy a home face some of the most challenging conditions in three decades. The high inflation and strict lending regulations, such as assessing loan applicants based on a 3 percent increase in interest rates, prevent many from entering the market.
Elliott also highlighted that people are “missing out on getting a home loan, running a business or getting a credit card, not because they’re bad people, but because regulation doesn’t allow banks to lean in and support those people.” Regulation comes at the cost of both fewer people getting into harm’s way and subsequently fewer individuals getting opportunities to own a home or invest.
Following this, the connection between migration and inflation was highlighted, with recent migration patterns significantly contributing to increased housing demand and inflation. Experts argued that the recent influx of migrants worsened the unaffordability problem, contributing to the tension residential areas are currently experiencing. Independent MP Dai Le highlighted that “huge migration is really putting pressure on the demand for housing, and that is driving up inflation as well.”
In addition, the rising inflation in Australia makes managing everyday expenses challenging for households and families. The consumer cost data from the Australian Bureau of Statistics revealed that working families saw a 9 percent increase in living costs from the same period last year, adding pressure to people’s livelihoods.
Strategies to mitigate the impact of this inflation on households are crucial, with the Prime Minister stating at an economic and social conference in Melbourne that addressing the high cost of living is their government’s top priority. However, several opposition MPs have criticized the government, highlighting the need for a more concrete plan to address inflation.