The affordable housing crisis is a global problem
You may have heard the news; cities across the globe are experiencing a crisis. Affordable housing is seemingly drying up due to lack of materials, labor shortages, or even more insidiously, manipulation of the system to suit the ultra-wealthy. What exactly is a housing crisis, and is it really as bad as its being made out?
Well, in simple terms, yes. The housing crisis is A well and truly global problem, as cities grow, the demand for housing increases. As the demand for housing rises, the land becomes more valuable and prices out those on the lower income brackets. This is a huge problem; the effects of such an abnormal rise in one commodity can have dire effects on the rest of the economy. Japan suffered such a housing price bubble in the 1980s, one that they still have not fully recovered from nearly 30 years later.
How is this happening?
You might be forgiven in thinking that such an issue would only affect big cities like New York or Hong Kong, but the problem sharply affects cities under rapid urbanization, these population centers are feeling the most severe effects. As cities become more powerful economically, the land in and around them becomes absurdly valuable.
As city real estate becomes the preserve of the very wealthy, real estate becomes a financial vehicle, a commodity to be traded and bet upon. Housing becomes an asset in a portfolio, not a basic human right for shelter. The oversupply of luxury housing pushes out affordable housing projects and keeps prices dishearteningly high.
Even with the cheapest home loan, in cities like Sydney, the cost of owning a home can be crippling. On average, Sydneysiders are spending over a third of their wages on housing. This bleeds money from other sectors as the housing market grows.
What can we do?
The most infuriating aspect of the housing crisis Is that governments do have the power to change it. Placing caps on foreign investment and investing in new, affordable housing projects is just the beginning. Despite huge amounts of money being funneled into housing, none of it has significantly increased the supply of affordable housing; rather it has increased the supply of high-end units that cost big money to build. A UN report notes that even if a small portion of global housing investment was put into affordable housing and credit for those who need it, affordable housing FOR EVERYONE would be in reach within 2030.
So, the solution is right in front of us. Yet again, the ultra-wealthy gain a monopoly on another basic human right, and then manipulate the game to suit themselves. While the average family struggles to pay their home loan, property developers are buying the land up at special rates, only to develop the land into unaffordable housing.
We, as a species, have the technology and resources to cater to everyone’s basic rights as a human being. Instead, developers build luxury apartments for the wealthy few. Our governments have long failed us and seem to be only interested in money coming in from big business. Our governments should be planning for every citizen’s future and ensuring we all have access to affordable housing, as it truly is a global crisis.
It is a sad and anger provoking state of affairs we are in. Once the domain of every citizen, affordable housing is disappearing faster than our natural resources. A huge rise in homelessness and an increase in crime are only the beginning of a much scarier crisis that is unfolding. The (artificial) lack of affordable housing continues to widen the gap between those with a lot, and those with nothing.