15 Years of Your Mortgage Goes to the Government — What That Means for Australia’s Housing Crisis with Tim Reardon

Did you know that for the first 15 years of your mortgage, you're working mostly for the taxman, not your future wealth?

It’s a startling claim, but one backed by data from the Housing Industry Association — and it sheds new light on why housing affordability is getting worse, not better.

Today, I’m joined by Tim Reardon, Chief Economist at the HIA, to unpack this extraordinary insight.

We explore how government taxes and regulatory charges are silently front-loading the cost of home ownership, inflating house prices, and burdening Aussie families before they’ve even laid a brick.

And while there’s some good news on the horizon — with interest rate cuts expected to drive a recovery in home building — the longer-term challenges are immense. Think taxes, planning bottlenecks, and a construction industry on its knees due to chronic underbuilding and workforce shortages.

Whether you’re a property investor, homeowner, or policymaker, this conversation will leave you thinking differently about the hidden forces shaping the housing market — and why just building more homes won’t be enough.

 

Takeaways 

·         The first 15 years of mortgage repayments primarily cover taxes.

·         Approximately 50% of the cost of a new house is attributed to taxes and fees.

·         Government policies significantly impact housing supply and affordability.

·         Subsidizing first home buyers does not address the root causes of housing unaffordability.

·         The 1.2 million homes initiative requires substantial policy changes to succeed.

·         Foreign investment is crucial for increasing housing supply.

·         Build-to-rent projects are not currently providing affordable housing options.

·         Interest rates directly influence the volume of new home building.

·         Labor availability is a significant challenge for the construction industry.

·         Policy reforms are necessary to improve housing supply and affordability.

 

Chapters 

01:12 Understanding Mortgage Repayments and Taxes

04:54 Challenges in Housing Supply and Infrastructure

09:00 Government Schemes and Their Limitations

10:39 The 1.2 Million Homes Initiative

14:41 The Future of Build-to-Rent Projects

17:01 Market Dynamics and Housing Affordability

20:27 Structural Challenges in the Housing Industry

23:18 Conclusion and Future Outlook

 

Links and Resources:

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Tim Reardon HIA Chief Economist 

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