Prior to the pandemic, ordinary Australians were already suffering from some of the highest housing prices in the world and record levels of household debt. The big banks and the Government offer no real housing relief over the horizon as COVID-19 worsens an already dire situation, the only choice is to fight back.
Many experts are saying that the worst is yet to come after the pandemic triggered the first recession in a generation. A housing bust is possible with millions of workers reliant on the temporary stimulus measures deployed by the Morrison government just to make ends meet.
Mortgage payment ‘holidays’ and bans on evictions and rent increases as well as other stimulus measures are due to end in September. Already under political pressure, the government has flagged that things will not just ‘snap back’ to how they were pre-pandemic.
However, they cynically refuse to give us make any decisions that give any certainty about our future. Before the Eden-Monaro by-election – a key bushfire-affected electorate – they refused to spell out new measures to begin in September.
This is because they were never planning to actually help people. They knew their plans were an electoral risk. This government of big business representatives plan to make ordinary people pick up the tab on both the bushfire and pandemic crises.
One measure alleged to help first home buyers or renovators, HomeBuilder, has proven not to be in the interests of the vast majority of ordinary people. It is instead a handout to big builders and developers, mostly engaged in building shoddy shoe box apartment towers.
As for home renovations, most Australians aren’t eligible for the $25,000 grant because they don’t have a spare $150,000 of their own to spend on renovations! Inequality will worsen as the mega-wealthy benefit by adding extra bathrooms and guest bedrooms to their mansions.
Over 20,000 households are at very high risk of defaulting on their mortgages, while at least another 250,000 households are considered at risk of defaulting as well. These households tend to work in industries where many jobs have been slashed, or were already precarious workers before the pandemic.
A rush of forced sales could drive down prices from their unsustainable bubble heights. That in turn could mean a crisis level of ‘negative equity’ emerges, where people’s homes are worth less than what they borrowed.
Because that could threaten the solvency of the big banks both they and their defenders, the Morrison Government, will do all they can to avoid it. But whatever measures are taken to defend profits and capital they will not be carried out with the needs of working class people in mind.
Even before the pandemic, more than a fifth of householders were in ‘housing stress’, meaning they were paying more than 30% of their income on housing. Many are paying much more than that! A productivity commission report from late last year said more than half of those renting are in housing stress.
Although there are important differences a limited comparison can be made to the stark situation ordinary people faced in the US in the 2007-2008 crash. The US crash led to mass evictions and repossessions. The experience of the US also shows that a drop in house prices doesn’t translate into relief for renters.
Homelessness is at disastrous levels already, with over 100,000 homeless people on any given night. Any evictions served must be resisted. But it will not be possible on an individual basis.
What would be needed is organised eviction resistance campaigns. There is a proud history in Australia of working class people organising themselves to resist evictions, like in Sydney in the 1930s. We can look to campaigns such as those for examples and inspiration.
But we need to go further than just resisting evictions. We need to go on the front foot and demand quality, affordable housing for all as a human right. This could be done by community campaigns linking up with construction unions to demand a plan to build environmentally friendly, high quality public housing. This goes hand in hand with creating sustainable jobs on union wages and conditions.
COVID-19 has reinforced what many of us already knew, the capitalist system doesn’t care about us. And we have to say that if this system can’t afford to give us secure jobs and high quality homes, then we can’t afford this system!
We need to come together to build a movement that challenges the logic of capitalism. This movement would fight for a future where housing is a human right, as part of a broader democratic socialist plan for running society and ensuring a decent future for all people.
By Kat Galea