Home National ‘Bitter Truth to Digest’: Expert Unveils Unpalatable Remedy for Australia’s Soaring Housing Prices

‘Bitter Truth to Digest’: Expert Unveils Unpalatable Remedy for Australia’s Soaring Housing Prices

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Michael Yardney, Director of Metropole Property Strategists, has underscored a critical disparity between the costs of constructing new homes and the selling prices developers can achieve. This imbalance has sparked a significant housing shortage in Australia, inflating prices across the market, as reported by 9news.com.au.

Yardney argues that to remedy this issue, property values must experience further increases, suggesting that developers believe a rise of 15 to 20 percent is necessary to make new projects financially viable. He stressed that this isn’t merely a matter of profit but is essential for sustainability in the housing market. If prices continue to stagnate or decline, the willingness to invest in new developments will diminish, worsening the housing crisis.

Statistics show that over the last 25 years, median house prices have surged by 412 per cent, with the current average price in Australia sitting at an eye-watering $976,800, according to the latest figures from the Australian Bureau of Statistics (ABS). Yardney warns that this is an uncomfortable but essential truth for potential homebuyers to acknowledge: the situation may deteriorate before improvement is seen.

He likens this necessary adjustment to “short-term pain for long-term gain” and insists that facing the uncomfortable realities of the housing crisis is essential for finding viable solutions. Australia is currently under-delivering in terms of housing, with projections revealing a shortfall of approximately 300,000 homes in the next five years.

In response to the urgency of this crisis, Brad Duggan, CEO of Metricon Homes, advocates for a “wartime response” from the federal government, calling for decisive action akin to that taken during national emergencies. He believes that immediate solutions, including streamlining the planning process, are critical to reversing the current housing shortage.

In summary, the pressing message from the property market experts is clear: increased property prices are necessary to stimulate the construction of new homes and alleviate the housing crisis plaguing Australia.

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