Just a few months after acquiring a prime Broadbeach site on the corner of First Avenue and Surf Parade, family-run developer <a href="https://www.apartments.com.au/developers/raptis">Raptis</a> has filed fresh plans for a new apartment development.

Raptis is seeking to deliver a <a href="https://www.apartments.com.au/new-apartments/17-19-first-avenue-broadbeach-qld-4217">29-storey tower with 73 apartments</a> on the 818 sqm site. It will be the developer's seventh project in the suburb, as they are approaching completion of The Sterling on George Avenue.

There will be a pool, barbecue and outdoor dining area, residents lounge and dining, sauna and steam room, gym, and a Yoga and Pilates studio.

<img alt="Raptis" data-entity-type="file" data-entity-uuid="b554da3f-7344-49aa-b1c9-44cf459af0d7" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-05%20at%2010.41.45%E2%80%AFAM.png?VersionId=zzjWu1iO1wnuYv4EV4fyOyf5nSXjGYut" />

Raptis Joint Managing Director, Evan Raptis, says they remain&nbsp;committed to developing quality infill sites across the Gold Coast in the lead-up to the 2032 Brisbane Olympics.

"This project continues our long track record of delivery in Broadbeach, and we look forward to bringing another premium development to this thriving precinct."

The announcement follows strong delivery momentum for Raptis, with The Sterling Broadbeach nearing completion and construction well underway on the final stage of the Waterpoint community adjacent to Harbour Town. The developer's continued investment in the Gold Coast reflects confidence in the region's apartment market fundamentals, underpinned by sustained Southeast Queensland population growth.&nbsp;

The outlook for the region is further bolstered by infrastructure investment tied to the Brisbane 2032 Olympic Games, which is expected to drive continued economic and population growth across the SEQ corridor.&nbsp;

Subject to a favourable response from Gold Coast City Council, construction on the new First Avenue tower is targeted to commence before the end of 2026.&nbsp;

Read more:&nbsp;<a href="https://www.apartments.com.au/news/qld/it-s-all-in-the-family-four-decades-later-raptis-continues-to-shape-the-gold-coast-skyline">It’s all in the family: Four decades later, Raptis continues to shape the Gold Coast skyline</a>

Read more: <a href="https://www.apartments.com.au/news/qld/raptis-secures-prime-surf-parade-site-for-next-broadbeach-apartment-development">Raptis secures prime Surf Parade site for next Broadbeach apartment development</a> 
&nbsp;

Gold Coast developer brings seventh Broadbeach project to market, targeting construction commencement before year end

Joel Robinson

First look: Raptis lodges plans for new 29-storey Broadbeach tower 

Brisbane development veteran Kevin Seymour's Seymour Group is set to deepen its presence on one of Brisbane's most tightly held riverfront addresses, lodging revised plans for a luxury apartment development on Oxlade, just a few doors down from The Oxlade, which it completed in 2024.

The <a href="https://www.apartments.com.au/new-apartments/70-72-oxlade-drive-new-farm-qld-4005">new project at 70-72 Oxlade Drive</a>, directly north of The Oxlade, will have 27 apartments across a seven-storey building&nbsp;overlooking the Brisbane River and Merthyr Park. It's a revision from a 2021-approved design.

Designed by bureau^proberts, the project has evolved from the previously approved 26-apartment scheme, introducing an additional penthouse level while maintaining a low-density, boutique character. The development will comprise 26 three-bedroom apartments and a single four-bedroom penthouse, supported by two basement levels with 86 car spaces and 34 bicycle spaces.

The architectural response is centred around two distinct building forms separated by a landscaped open-air atrium.&nbsp;"This dual composition captures and embraces Brisbane’s subtropical environment whilst breaking down built form and scale," the submission to the Brisbane City Council noted.

<img alt="First look: Seymour Group returns to Oxlade Drive with revised riverfront apartment plans in New Farm" data-entity-type="file" data-entity-uuid="c12d84d0-bc11-4067-b46f-5bd2d786a34d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/new%20farm%20landscape.png?VersionId=YEPc2k5CAdh6aAPlu4uVpgZadh4MEfRd" />

A defining feature of the design is a deep landscaped void running through the centre of the building, creating what bureau^proberts describes as a "natural ravine" that enhances airflow, daylight penetration and resident amenity. The design report notes that the separation of the two building volumes is intended to maximise natural light, cross-ventilation and outlook while strengthening connections to the surrounding riverfront setting.

Curved balcony edges, integrated planting and extensive landscaping throughout the façade reinforce the subtropical design approach. The building's façade is softened by elevated gardens and planter beds, creating a green edge that complements the established landscape character of Oxlade Drive and neighbouring Merthyr Park.

New Farm has become one of Brisbane's most sought-after suburbs for developers delivering premium downsizer-focused apartments.

GRAYA has been particularly active in the precinct, completing both Chalk and York in recent years, while construction of Moray House, being delivered for Spyre, is now nearing completion. Architect-turned-developer Joe Adsett recently launched <a href="https://www.apartments.com.au/new-apartments/arcilla-new-farm-by-joe-adsett-28-maxwell-street-new-farm-qld-4005">Arcilla on Maxwell Street</a>, an exclusive collection of just nine apartments.

First look: Seymour Group returns to New Farm's Oxlade Drive with riverfront apartment plans

A new residential tower will be the first piece of a broader mixed-use precinct set to reshape a prominent Newcastle West site, with local developer <a href="https://www.apartments.com.au/developers/gwh">GWH</a> bringing its <a href="https://www.apartments.com.au/new-apartments/cambridge-quarter-newcastle-west-12-denison-street-newcastle-west-nsw-2302">Cambridge Quarter</a> vision to market.

The first release, Tempo, will introduce 87 apartments across a 24-storey tower, marking Stage 1 of the residential component of a larger urban regeneration project planned for the western end of Newcastle's city centre, encompassing the former Cambridge Hotel site.

Positioned on Denison Street, Tempo has been designed as the inaugural building within Cambridge Quarter, a precinct that will ultimately combine apartments, retail activation and revitalised public spaces including the revamping of the Cambridge Hotel.

[smartcode_project:default project_id=135876 project_image_fid=368853]

The tower will comprise a mix of one, two and three-bedroom apartments, including layouts with multipurpose rooms, catering to a broad cross-section of owner-occupiers. Apartment sizes range from around 60 sqm to 192 sqm, with a number of residences oriented to capture views across Newcastle Harbour, the city skyline and coastline.

GWH has emphasised liveability in the design, with open-plan layouts extending to generous balconies and terraces. Residents will have a choice of two interior palettes, while specifications include engineered stone benchtops, SMEG appliances, full-height bathroom tiling and secure building access. Premium upgrade packages will also be available.

Multiple rooftop resident retreats will provide communal outdoor space overlooking the harbour and city, offering an elevated amenity layer above the activity of the precinct below.

[smartcode_project:default project_id=135876 project_image_fid=368851]

The broader Cambridge Quarter vision extends beyond the residential tower itself. Ground-level retail activation and landscaped public areas are planned throughout the precinct, creating a walkable neighbourhood environment connected to the surrounding renewal of Newcastle West. The Cambridge Hotel is also earmarked for future redevelopment into a family-friendly hospitality venue integrated with the new precinct.

The project is strategically positioned within walking distance of Newcastle Interchange, providing access to light rail, regional rail services and direct connections to Sydney. Residents will also be close to Honeysuckle, Newcastle Harbour and the city's beaches and coastal walkways.

[smartcode_project:default project_id=135876 project_image_fid=368852]

For GWH, Cambridge Quarter represents one of its most significant Newcastle developments to date. The locally based developer, which has operated in the Hunter region since 1995, describes the project as a new chapter in the ongoing transformation of Newcastle West.

GWH Executive Director Jonathan Craig said the project had been shaped by a focus on creating lasting community connections.

"We take pride in creating places that last. Spaces where people feel connected, comfortable and a genuine sense of belonging," Craig said.

"Cambridge Quarter is something we are truly proud of, a place shaped by local knowledge, built with care and designed to be part of Newcastle's next chapter."

[smartcode_project_cta:default project_id=135876]

GWH unveils first release at landmark Cambridge Quarter precinct in Newcastle West

<a href="https://www.apartments.com.au/developers/ss-projects">S&amp;S Projects</a>,&nbsp;Rainbow Bay's busiest developer,&nbsp;has officially lodged plans for the largest development in its booming local portfolio, seeking approval for a further 88 apartments on Boundary Street.

The proposal&nbsp;at <a href="https://www.apartments.com.au/new-apartments/209-213-boundary-street-coolangatta-qld-4225">209–213 Boundary Street, Coolangatta</a>,&nbsp;marks the next chapter in the developer's transformation of the southern Gold Coast beachside precinct. It will be its fifth in the area, having already delivered Flow, Awaken and Esprit, while construction continues on the 38-apartment Radia. The new project would rise 57 metres above a consolidated 1,518 sqm site, on the same street as Radia and Esprit.

&nbsp;

Designed by <a href="https://www.apartments.com.au/architects/cottee-parker-architects">Cottee Parker</a>, the proposed development comprises 88 two and three-bedroom apartments across a contemporary podium-and-tower form that integrates extensive landscaping from street level through to the rooftop.

The tower would be delivered above a basement and multi-level podium accommodating resident and visitor parking, with the residential component commencing from level three. The design incorporates cascading planting throughout the façade, landscaped podium edges, and deep planting zones along the Boundary Street frontage.

<img alt="First look: S&amp;S Projects lodges plans for 88-apartment wellness tower at Coolangatta's Boundary Street" data-entity-type="file" data-entity-uuid="677e6615-b5c0-4b6c-b4f9-efb14fcde1a6" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/ss%20da%20pers.png?VersionId=YOnPKQm7IFXv0M5H326djEpxk80500Hi" />

A key feature of the development is its expansive rooftop wellness and recreation precinct. Plans reveal a resort-style pool deck, gymnasium, sauna, steam room, hot and cold plunge pools, rooftop terraces, barbecue areas and landscaped relaxation spaces positioned to capture views across the southern Gold Coast coastline.

The rooftop wellness focus builds on the vision S&amp;S Projects first outlined when it acquired the site for $20.25 million last year.

"We are taking every advantage to create a truly unique rooftop wellness experience with a natural feel for residents, offering stone features throughout and an underlying theme that emulates a botanical garden," S&amp;S Projects founder and director Paul Gedoun said at the time.

The proposal seeks a 57-metre building height, representing a 50 per cent uplift on the site's mapped 38-metre height limit. Planning documents argue the additional height is consistent with recently approved and emerging towers in the immediate Boundary Street and Rainbow Bay precinct.

Urbis, acting as planning consultant, said the development would provide "88 dwellings, comprising a mix of two and three-bedroom apartments, contributing to housing choice and supply within an established medium to high-rise coastal urban neighbourhood."

The scheme has undergone extensive pre-lodgement consultation with the City of Gold Coast, with the design refined following feedback relating to architectural expression, landscaping, traffic access and podium treatment.

<img alt="S&amp;S" data-entity-type="file" data-entity-uuid="0a2d70fd-62ac-4b83-97c6-b798fc1243dd" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Screenshot%202026-06-05%20at%209.16.31%E2%80%AFAM.png?VersionId=yHmghUwKM3IVGpBktQU1mE.0Lpf3WimG" />

The architectural team is led by Brisbane-based Cottee Parker, one of Australia's most active residential design studios, with landscape architecture by Dunn + Moran. The consultant team also includes ADG Engineers, Windtech and Acoustic Works.

S&amp;S Projects has become one of the most influential private developers operating on the southern Gold Coast. Since entering Rainbow Bay in 2022, the company has assembled a portfolio exceeding $1 billion in end value, establishing itself as a key player in the area's evolution into a premium apartment destination. Pezet Matheson will again handle the sales for S&amp;S.

Coolangatta is entering another wave of apartment development, following the delivery of several prominent residential projects in recent years.

John Kearney's Immerse Projects will launch&nbsp;<a href="https://www.apartments.com.au/new-apartments/kaiya-kirra-beach-5-haig-street-coolangatta-qld-4225">Kaiya on Haig Street</a>&nbsp;soon, meanwhile, Palm Beach-based Sherpa Property Group is preparing to bring its debut Coolangatta development, <a href="https://www.apartments.com.au/new-apartments/flourish-viver-87-griffith-street-coolangatta-qld-4225">Flourish Viveré</a>, to market later this year, subject to approvals.

First look: S&S Projects proposes 88-apartment wellness tower at Coolangatta's Boundary Street

A landmark former orphanage site in Surrey Hills could be transformed into a new residential community under plans lodged by <a href="https://www.apartments.com.au/developers/antipodean-land-developments">Antipodean Land Developments</a> that would deliver 76 apartments and townhouses while restoring some of the suburb's most significant heritage buildings.

The burgeoninng Melbourne-based developer has submitted plans for the 9,158 sqm site at 1 Kent Road and 24 Durham Road, home to the former St Joseph's Home for Destitute Children, a historic institutional complex dating back to the late 19th century. The proposal seeks to adaptively reuse several heritage buildings while introducing two new four-storey residential buildings set within extensive landscaped grounds.

Designed by <a href="https://www.apartments.com.au/architects/woods-bagot">Woods Bagot</a> and Kerstin Thompson Architects, the project has been conceived as a contemporary residential village embedded within a restored heritage precinct. The development team describes the design approach as "The Village in the Garden," with new buildings positioned among mature landscaping by OCULUS and significant heritage structures.

<img alt="First look: Antipodean Land Developments plans heritage-led apartment community in Surrey Hills" data-entity-type="file" data-entity-uuid="44ec8c1b-c0b6-44ae-859e-5811b3e6a023" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Untitled%20design%20%281%29.png?VersionId=p.p1_KFh4iQoV4nisdnPfQBAsWNi7m79" />

The proposal would deliver 76 dwellings comprising a mix of apartments and duplex-style residences, significantly increasing housing supply on one of the largest privately held residential landholdings in Surrey Hills. The development includes 127 car spaces, 24 bicycle spaces and more than 1,000 sqm of communal amenity, with the existing chapel building earmarked for conversion into resident facilities.

According to the planning submission, the project centres on the restoration and adaptive reuse of the site's most significant heritage assets, including the original c.1889 St Joseph's building, the chapel designed by architect Augustus Andrew Fritsch, and the historic brick perimeter walls and entry gates. The proposal also incorporates the retention of other contributory buildings including the former infirmary and school building.

Tract Consultants, in the planning report accompanying the application, said the scheme had been shaped through extensive heritage analysis and design development.

"The shared vision for the Site by the project team has culminated in a scheme which successfully breathes life back into a historic site while delivering upon the objectives of Victoria's Housing Statement in a carefully curated and contextually responsive manner."

<img alt="First look: Antipodean Land Developments plans heritage-led apartment community in Surrey Hills" data-entity-type="file" data-entity-uuid="7263b7d8-95ea-400f-9531-6ca7d22c3c33" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Untitled%20design%20%282%29.png?VersionId=4cR1tiWOsDpgxEOwZi5vVFcyvvOsYkIE" />

The proposal is being assessed under Victoria's Significant Residential Development with Affordable Housing pathway. As part of the application, three per cent of the project's residential development cost would be contributed to the Social Housing Growth Fund. The development would also provide a diverse mix of one, two and three-bedroom residences targeting a broader range of buyers than typically found in Surrey Hills' detached housing market.

Sustainability initiatives include an anticipated 66 per cent BESS score, natural cross-ventilation to 80 per cent of apartments, 28 per cent deep soil landscaping and a canopy cover outcome exceeding local planning requirements. The proposal also sets aside more than 1,083 sqm for communal indoor and outdoor resident amenity spaces.

<img alt="First look: Antipodean Land Developments plans heritage-led apartment community in Surrey Hills" data-entity-type="file" data-entity-uuid="33fad46f-fe26-4d0a-acfd-6b776e1c6a3d" src="https://s3.ap-southeast-2.amazonaws.com/www.urban.com.au/s3fs-public/inline-images/Untitled%20design.png?VersionId=D9F6WVSyYCtGvSUmith35LRp6R7PQkw_" />

Planning documents describe the property as one of the largest underutilised residential sites in Surrey Hills, arguing it presents a rare opportunity to introduce "missing middle" housing in an established inner-eastern suburb while preserving and revitalising a significant heritage precinct.

Antipodean Land Developments has built a reputation for design-focused residential projects across Melbourne, particularly in the medium-density sector. Previous developments include Neighbourhood in Brunswick East, delivered with Breathe Architecture, and Balfe Park Lane, designed by Kerstin Thompson Architects.

They've been very active in site acquisition as they build out their future development pipeline. They recently launched Thornubury House, 45 apartments above a mix of commercial, retail, and food and beverage tenancies, and have plans for a boutique project in Fitzroy and another <a href="https://www.apartments.com.au/news/vic/antipodean-plan-apartments-for-deepdenes-missing-middle-on-whitehorse-road">"missing middle" project</a> on Deepdene's Whitehorse Road.

First look: Antipodean Land Developments plans heritage-led apartment community in Surrey Hills

Wealth Inequality

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EXPERT OBSERVER
New research on disadvantage in Australia has found the gap between rich and poor is very wide in Sydney, while much of Queensland struggles with educational disadvantage and regional NSW and Victoria are both more disadvantaged when it comes to health.
Previous research on poverty has placed a heavy emphasis on income and economic outcomes at a given point in time. But disadvantage often goes beyond just economic factors. It’s also necessary to analyse the educational, health and social inequities in society to get a more accurate understanding of disadvantage.
At the core of our new research, published in our <a href="https://mappingthepotential.cssa.org.au/index.php/about/" target="_blank">Mapping the Potential report</a>, is the idea that disadvantage in Australia is more varied and complex than many people may think.
How we conducted our research
This research, conducted by the ANU Centre for Social Research and Methods and commissioned by Catholic Social Services Australia, expands on the socioeconomic indexes produced by the Australian Bureau of Statistics by adding more detailed variables across health, education, social and economic domains.
We also incorporated a “persistence” element to disadvantage – in that, disadvantage isn’t tied to a singular point in time, but persists for a longer period.
In our research, disadvantage was data-driven. And to quantify disadvantage, we chose variables that were generally considered relevant for each area. For economic disadvantage, for instance, we looked at low incomes, low-skilled jobs and unemployment. Areas with a large share of people with these characteristics tended to be more disadvantaged.
Health disadvantage was based on various chronic health conditions, such as diabetes, heart and circulatory conditions, and obesity.
Educational disadvantage focused on levels of educational attainment and child educational disadvantage - both cognitive and physical development. We used data from the <a href="https://www.education.gov.au/australian-early-development-census#:%7E:text=The%20Australian%20Early%20Development%20Census,in%20the%20community%2C%20not%20individuals." target="_blank">Australian Educational Development Census</a> to gauge this.
Social disadvantage was less clearly defined. We focused on variables that contribute to <a href="https://www.oecd.org/insights/37966934.pdf" target="_blank">social capital</a>, or the interpersonal networks that help a society function effectively. Regions with social disadvantage, for example, tended to have low rates of volunteering, internet connection and social cohesion.
Geographically, we analysed these variables at the <a href="https://www.abs.gov.au/websitedbs/D3310114.nsf/home/Australian+Statistical+Geography+Standard+(ASGS)" target="_blank">SA2 level</a> (areas comprised roughly of suburbs and towns) across Australia. We then aggregated the results to the federal electorate level to avoid singling out and possibly stigmatising individual suburbs.
For comparison purposes, each index was standardised to an average score of 1,000 across all SA2s. Nearly all SA2s (95%) had a score between 800 (high disadvantaged) and 1,200 (low disadvantage).
<a href="https://images.theconversation.com/files/336906/original/file-20200522-102642-2uyeuo.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/336906/original/file-20200522-102642-2uyeuo.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
The Conversation, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/" target="_blank">CC BY-ND</a>
To better understand differences between our major populations, we further aggregated our results to nine larger geographic entities: the five major capitals, the regional areas of NSW, Queensland and Victoria and a “catch all” remainder of Australia region. This last grouping was used due to the small number of electorates in some states and territories.
The most disadvantaged parts of Australia
The key finding of the report is there is considerable variation in the types of disadvantage experienced across Australia. Moreover, the types of disadvantage varied between locations, as well.
Australia’s most disadvantaged electorate overall was Hinkler in regional Queensland. Hinkler ranks poorly in three of the disadvantage domains we tracked: health, economic and social.
Australia’s least disadvantaged electorate is North Sydney.
<a href="https://images.theconversation.com/files/336908/original/file-20200522-102678-4snacf.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/336908/original/file-20200522-102678-4snacf.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
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The Conversation, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/" target="_blank">CC BY-ND</a>
When we looked at each type of disadvantage individually, we found that electorates had very different needs.
From an economic perspective, for example, our most disadvantaged electorate is Blaxland in Western Sydney. Our most disadvantaged health electorate is Braddon in regional Tasmania.
The most disadvantaged educationally was Spence in the northern suburbs of Adelaide. Socially, the most disadvantaged electorate was Parkes in regional NSW.
<a href="https://images.theconversation.com/files/336919/original/file-20200522-57709-h82zlg.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/336919/original/file-20200522-57709-h82zlg.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
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<a href="https://images.theconversation.com/files/336921/original/file-20200522-57679-3fbr7b.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/336921/original/file-20200522-57679-3fbr7b.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
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When comparing the larger regions in our report, we found Adelaide faces the most disadvantage overall, while Sydney and Perth have, on average, the least overall disadvantage.
Even the best-performing regions have pockets of high disadvantage. For example, while Sydney has a relatively strong overall result, it also has the most economically disadvantaged electorate in Australia (Blaxland) and several suburbs with scores below 800.
The research also shows the vast disparities between urban and regional areas in Australia. For example, according to our data, nearly the whole of regional NSW is considered disadvantaged. In contrast, the inner suburbs of Sydney are much better-off.
<img src="https://images.theconversation.com/files/316985/original/file-20200225-24694-1eticck.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
Differences in disadvantage between regional NSW and greater Sydney.
Most concerning was the deep level of disadvantage found in predominantly Indigenous communities, mostly in the Northern Territory. The electorate of Lingiari, for instance, has a marked split between the relatively advantaged suburbs around Darwin and the deeply disadvantaged areas outside the city.
We also found a number of electorates in coastal NSW, Queensland and Tasmania with significant health disadvantage. This is concerning given the threat of future outbreaks of COVID-19.
Why this data matters
The indexes remind us that despite nearly 30 years of continued economic growth in Australia, prosperity has not come to all parts of the country. Nor is economic advantage necessarily an indication of other facets of well-being, such as educational or health equality.
This data is important because it can help non-profit organisations make better-informed decisions on where and how to allocate future resources and investments.
It will also help governments at all levels gain a deeper understanding of the types of disadvantage that exist within regions and how their programs and other methods of assistance – both financial or non-financial – can be most effective.
<a href="https://theconversation.com/profiles/ben-phillips-98866" target="_blank">Ben Phillips</a>, Associate Professor, Centre for Social Research and Methods, Director, Centre for Economic Policy Research (CEPR), <a href="https://theconversation.com/institutions/australian-national-university-877" target="_blank">Australian National University</a> and <a href="https://theconversation.com/profiles/brenton-prosser-10876" target="_blank">Brenton Prosser</a>, Professor, <a href="https://theconversation.com/institutions/university-of-canberra-865" target="_blank">University of Canberra</a>
This article is republished from <a href="https://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/where-are-the-most-disadvantaged-parts-of-australia-new-research-shows-its-not-just-income-that-matters-132428" target="_blank">original article</a>.
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j.ballantyne1990-6AQqhLzZaK

Where are the most disadvantaged parts of Australia? New research shows it's not just income that matters

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GUEST OBSERVATION
Building an extra 50,000 homes each year for a decade could make prices and rents 20% cheaper. 
Compared to the rest of the world, income inequality is not particularly high in Australia, nor is it getting much worse.
The real problem is housing inequality.
Rising house prices have increased <a href="https://theconversation.com/what-the-bureau-of-statistics-didnt-highlight-our-continuing-upward-redistribution-of-wealth-121731" target="_blank">wealth inequality</a>. Rising housing costs have dramatically widened the gap between high and low disposable incomes.
The gap between low-income and high-income households in Australia is <a href="https://grattan.edu.au/wp-content/uploads/2019/04/916-Commonwealth-Orange-Book-2019.pdf" target="_blank">close to the OECD average</a>. Income inequality – measured by the gini coefficient – <a href="https://www.abs.gov.au/AUSSTATS/abs@.nsf/Lookup/6523.0Main+Features12017-18?OpenDocument" target="_blank">has fallen</a> slightly over the past decade.
The <a href="https://www.pc.gov.au/research/completed/rising-inequality/rising-inequality.pdf" target="_blank">Productivity Commission</a> says inequality has increased only slightly in the past three decades. Economists at the <a href="https://www.rba.gov.au/publications/rdp/2015/pdf/rdp2015-15.pdf" target="_blank">Reserve Bank</a> have come to similar conclusions.
But inequality is growing once housing costs are factored in, with the poor being hurt the most.
Incomes for the lowest 20% of households <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf" target="_blank">increased</a> by about 27% between 2003-04 and 2015-16. But their incomes after housing costs increased by only about 16%. Low-income Australians are spending <a href="https://grattan.edu.au/wp-content/uploads/2018/03/901-Housing-affordability.pdf" target="_blank">much more</a> than they used to keep a roof over their heads.
In contrast, incomes for the highest 20% of households increased by 36%, and their after-housing incomes by 33%.
Leaving the young and poor behind
Home ownership is increasingly benefiting the already well-off. Since 2003-04, increasing property values have contributed to the wealth of high-income households increasing by more than 50%. Wealth for low-income households has grown by less than 10%
<hr>
<a href="https://images.theconversation.com/files/289162/original/file-20190823-170922-dg3w9b.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/289162/original/file-20190823-170922-dg3w9b.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
<hr>
As we’ve <a href="https://theconversation.com/retiree-home-ownership-is-about-to-plummet-soon-little-more-than-half-will-own-where-they-live-115255" target="_blank">noted previously</a> rising housing costs have widened the gap between renters and home owners. As property prices have escalated, the higher deposit hurdle has seen rates of home ownership falling fast among the young and the poor.
In 1981 more than 60% of those aged 25-34 had a mortgage; by 2016 it was 45%. The trends are similar among older groups. In the same period, home ownership among the poorest 20% of households has fallen from 63% to 23%.
The big winners of the property boom have typically been older Australians <a href="https://theconversation.com/for-the-first-time-in-a-long-time-were-setting-up-a-generation-to-be-worse-off-than-the-one-before-it-121983" target="_blank">lucky enough</a> to buy a house before prices took off. Housing has thus compounded <a href="https://theconversation.com/three-charts-on-the-great-australian-wealth-gap-84515" target="_blank">inequality between the young and old</a>.
This could lead to higher inequality in the future, because the children with wealthier parents can rely on the “bank of mum and dad” to break into the housing market, and then inherit their parents’ home as an investment property.
Many low-income Australians <a href="https://theconversation.com/rethink-inheritances-these-days-they-no-longer-help-the-young-they-go-to-the-already-middle-aged-122029" target="_blank">won’t be so lucky</a>, which is why the share of Australians who own their homes is expected to <a href="https://theconversation.com/retiree-home-ownership-is-about-to-plummet-soon-little-more-than-half-will-own-where-they-live-115255">fall sharply</a> in the decades ahead.
<hr>
<a href="https://images.theconversation.com/files/268787/original/file-20190411-44785-55hftp.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/268787/original/file-20190411-44785-55hftp.png?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
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A clearer policy agenda
Despite the clear evidence housing is key to inequality in Australia, housing policy is thin on the ground.
In the dying days of the federal election campaign, the Coalition announced a <a href="https://theconversation.com/the-brutal-truth-on-housing-someone-has-to-lose-in-order-for-first-homebuyers-to-win-117010" target="_blank">plan</a> to help those struggling to save the 20% deposit normally required to buy a home.
The federal government has also made it easier for people to access their <a href="https://www.ato.gov.au/individuals/super/withdrawing-and-using-your-super/first-home-super-saver-scheme/" target="_blank">super</a> to pay the deposit.
These policies might be popular but do little to improve housing affordability for low-income earners; they might even <a href="https://insidestory.org.au/another-lost-opportunity-for-housing-affordability/" target="_blank">do more harm than good</a>.
Labor, meanwhile, ran with a <a href="https://theconversation.com/shortens-subsidy-plan-to-boost-affordable-housing-108881" target="_blank">proposal</a> during the last election campaign to build 250,000 new affordable housing dwellings, using a mechanism similar to the earlier National Rental Affordability Scheme (NRAS). On our <a href="https://blog.grattan.edu.au/2019/09/learning-from-past-mistakes-lessons-from-the-national-rental-affordability-scheme/">analysis</a>, though, the original NRAS was poor value for money, and did not target those most in need.
Addressing inequality requires a clearer view on what to do about rising housing costs.
The priority should be to <a href="https://grattan.edu.au/report/commonwealth-orange-book-2019/" target="_blank">boost Rent Assistance</a> by 40% – an extra A$1,410 a year for singles and A$1,330 for couples – and benchmark it to rents paid by low-income renters.
The federal government should also give <a href="https://grattan.edu.au/report/commonwealth-orange-book-2019/" target="_blank">more funding</a> to the states for social housing carefully targeted to people at serious risk of homelessness.
Emulating the Rudd-era <a href="http://www.nwhn.net.au/admin/file/content101/c6/social_housing_initiative_review.pdf" target="_blank">Social Housing Initiative</a>, which resulted in 20,000 new social housing units being built and thousands more refurbished at a cost of A$5.6 billion, would provide a much-needed boost to housing construction when the pipeline is <a href="https://www.rba.gov.au/publications/smp/2019/may/pdf/statement-on-monetary-policy-2019-05.pdf" target="_blank">drying up</a>.
Supply-side economics
But redistribution alone won’t be enough. Housing is a A$6.6 trillion market. Subsidies can only paper over market failures arising from overly strict zoning rules that <a href="https://grattan.edu.au/report/housing-affordability-re-imagining-the-australian-dream/" target="_blank">prevent greater density</a> in our major cities.
Housing inequality will really only fall if housing costs fall. That requires building more houses. We <a href="https://grattan.edu.au/report/housing-affordability-re-imagining-the-australian-dream/" target="_blank">estimate</a> building an extra 50,000 homes a year for the next decade would make house prices and rents 10% to 20% lower than they would be otherwise.
This is primarily a challenge for state governments. They govern the local councils that set most planning rules and assess most development applications. But the federal government can and should <a href="https://grattan.edu.au/wp-content/uploads/2019/04/916-Commonwealth-Orange-Book-2019.pdf">encourage</a> the states to boost housing supply by reforming land-use planning and zoning laws.
If Scott Morrison really believes in “<a href="https://www.theaustralian.com.au/nation/politics/scott-morrison-pays-tribute-to-grandmother-in-mardigras-ritual/news-story/5af22d241145aae979e8d694d2f7dbe7" target="_blank">a fair go for Australians</a>”, he needs to tackle the housing crisis.<img src="https://counter.theconversation.com/content/119872/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Brendan Coates, Program Director, Household Finances, Grattan Institute.
Carmela Chivers, Associate, Grattan Institute.
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/rising-inequality-in-australia-isnt-about-incomes-its-almost-all-about-housing-119872" target="_blank">original article</a>.
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Rising inequality in Australia isn’t about incomes, it’s almost all about housing: Grattan Institute

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GUEST OBSERVATION
Australia’s super rich are richer than ever, but not like they used to be.
Since the surprise re-election of the Coalition, there has been renewed debate about the role the “aspirational” Australian played in the final outcome. The debate is taking place against the backdrop where income inequality has been growing in most developed countries over the past half-century, including in Australia.
Bureau of Statistics figures released on Friday show that the wealth of Australia’s wealthiest households has grown <a href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/6523.0%7E2017-18%7EMain%20Features%7EKey%20Findings%7E1" target="_blank">much faster</a> than the wealth of the rest.
<hr>
Household net worth by quintile (top fifth to bottom fifth)
<a href="https://images.theconversation.com/files/284287/original/file-20190716-173351-ydebm9.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/284287/original/file-20190716-173351-ydebm9.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
AUD millions, top quintile is the wealthiest 20% of households. <a class="source" href="https://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/6523.0~2017-18~Main%20Features~Key%20Findings~1" target="_blank">ABS 6523.0</a>
<hr>
Over the course of the 20th century, income equality has been U-shaped, a point noted by French economist <a href="https://theconversation.com/is-pikettys-capital-in-the-twenty-first-century-really-the-most-unread-bestseller-67713" target="_blank">Thomas Piketty </a> and Australia’s Productivity Commission.
In Australia, the income share of the top 1% peaked at 14% in 1950, then fell to a low of 5% in the early 1980s before climbing again to 9% by 2015.
Wealth inequality has also followed a long term U-pattern, and in many countries wealth is even more concentrated than income.
The Productivity Commission finds that in Australia, a person at in the top 10% of wealth distribution has <a href="https://www.pc.gov.au/research/completed/rising-inequality" target="_blank">40 times</a> as much wealth as a person in the bottom 10%. That person has four times as much income.
<hr>
Income shares of the top 1%, by country
<a href="https://images.theconversation.com/files/283954/original/file-20190713-173334-1sivwtw.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/283954/original/file-20190713-173334-1sivwtw.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt=""></a>
Per cent of unequivalised gross taxable income earned by the top 1% of adult income earners, 1913 to 2013. <a class="source" href="https://www.pc.gov.au/research/completed/rising-inequality/rising-inequality.pdf" target="_blank">Productivity Commission, 2018</a>
<hr>
In a paper to be presented to the Australian Conference of Economists in Melbourne on Tuesday, my colleague Monica Jurin and I shed light on wealth inequality over the past three decades through the lens of Australia’s super rich – the richest 200 households and families.
The super rich are changing
<a href="https://images.theconversation.com/files/283918/original/file-20190713-173355-1exi30j.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img src="https://images.theconversation.com/files/283918/original/file-20190713-173355-1exi30j.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=237&amp;fit=clip" alt=""></a> 
<a class="source" href="https://www.afr.com/rich-list" target="_blank">The BRW/AFR Rich List, updated since 1984</a>
Based on the <a href="https://www.afr.com/rich-list" target="_blank">Rich List</a>, compiled by the Business Review Weekly since the 1980s, and now updated annually by the Australian Financial Review, we examine the importance of inherited wealth versus entrepreneurship among Australia’s super rich.
The Rich List confirms the rise in wealth inequality. In 2019, the richest 200 families accounted for 3.6% of the aggregate net worth of all Australian families, up significantly from 2.3% in 1989.
But the importance of inherited wealth appears to have diminished.
Those with inherited wealth and family businesses today make up one-third of the super rich, well below 43% in 1989, with a gradual decline over each of the past three decades. Inherited wealth by itself accounts for 37% of the Rich List’s net worth today, well below 55% in 1989.
The emergence of technology entrepreneurs such as <a href="https://www.afr.com/rich-list/how-the-rich-invest-mike-cannonbrookes-20180605-h1107b" target="_blank">Mike Cannon-Brookes and and Scott Farquar</a>, founders of software company Atlassian, stand out.
Today, the technology sector accounts for almost 8% of the Rich List’s net worth, compared to almost none in 1989.
The results seem somewhat less egalitarian when we examine whether those on the list have appeared on it before.
They’ve more persistence, less inheritance
For instance Frank Lowy, co-founder of Westfield, is considered to be self made. But once on the list, he remained on in each of the four decades we examined.
Whatever the sources of one’s entry to the Rich List, members like Mr Lowy provide evidence of persistence. Conditional on being on the list a decade earlier, members have a slightly higher probability of remaining on it than they did in 1999, controlling for death and other factors.
Our findings complement those of <a href="https://www.aeaweb.org/articles?id=10.1257/aer.103.3.158" target="_blank">Steven Kaplan and Joshua Rauh</a> who observe similar patterns in the <a href="https://www.forbes.com/forbes-400/#332701f57e2f" target="_blank">Forbes 400</a> list in the US.
Here, and in the United States
They find that inherited wealth has become less important and being college educated has become more important.
In Australia we find that a substantially higher share of the richest individuals are tertiary qualified today than they were in 1989, but we are reluctant to draw strong conclusions because the entire society has greater access to tertiary education than it did in 1989.
The super rich have occupied a unique place in modern Australian culture since the emergence of conspicuous entrepreneurs and the emergence of the Rich List in the 1980s.
They are changing, and probably in a good way, even as inequality is growing.

<hr>
Salvatore Ferraro, Lecturer, RMIT University
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/inequality-is-growing-but-it-is-also-changing-as-australias-super-rich-evolve-119925" target="_blank">original article</a>.
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Inequality is growing, but it is also changing as Australia's super rich evolve: Salvatore Ferraro

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Australia’s financial inequality gap has narrowed for the first time in seven years, with most households feeling better about their finances, according to ME Bank’s 15th bi-annual Household Financial Comfort Report.
The report found this to be the case despite significant falls in residential property and share markets.
Consulting Economist for ME, Jeff Oughton, said “The comfort gap between property owners and renters, as well as between very high income earners and other income brackets, has narrowed."
“We’ve seen a correction for wealthier, older property-owning Australians who’ve been riding the hot property and bull share markets for much of the past seven years, while middle and lower-income households have begun to benefit from an easing in living cost pressures and income gains."
“Cooling housing and share markets haven’t yet dented the financial outlook of most Australian households, and many residential property owners remain positive: only 13% of home owners and 11% of investors expect the value of their properties to fall in 2019,” he concluded
The report found, "financial comfort of renters, while still significantly lower than other tenures, was up 8% to 4.78 out of 10, its highest in four years, reflecting improving rent conditions, while the overall financial comfort of households who own a home mortgage-free fell 3% to 6.27 out of 10, its lowest point since the survey began."
Financial Comfort
<ul>
<li>Those earning over $200,000 pa fell by 6% to 6.79.</li>
<li>Those earning $75,000-$100,000 pa increased by 7% to 5.87</li>
<li>Those earning under $40,000 pa increased 2% to 4.52</li>
</ul>
In the six months to December 2018, the report’s overall Household Financial Comfort Index increased by 2% to 5.56 out of 10, the highest in the past 5 surveys (30 months).
Slightly above the historical average of 5.45 out of 10 since the survey began in October 2011.
 ‘Changes to my income’ was also the most common reason cited for improvements to one’s financial situation.
Another contributing factor to the overall increase in household financial comfort was an improvement in how households felt about their ‘ability to pay regular expenses’, which increased 3% to 6.60 out of 10 – albeit the cost of necessities remains the ‘biggest worry’ about their household finances.
Mr Oughton said, “we’re still seeing some geopolitical effects, with households concerned about the world economy up two points to 29%, and combined with domestic property and share market corrections, many Australians are beginning to tighten their belts to build financial resiliency."
“If above average cash savings and reduced spending behaviour continues during 2019 it could significantly slow economic growth and in turn may lead to smaller job and income gains.”
Increased savings has flowed through to greater financial resilience with an improvement in households’ ability to handle a financial emergency (up 1% to 4.83, the second highest level since the report began).
Almost half of households with a mortgage (49%) continue to pay above the minimum in repayments. 
The report found a decline in households being unable to meet debt servicing commitments in the last year, with just 12% unable to meet a personal loan or credit card repayment.
Furthermore, only 7% missed a mortgage payment due to lack of funds in this time. 
Financial comfort in Queensland jumped markedly to a record level in December 2018 – up 8% to 5.68, the highest across Australia.
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Australia’s financial inequality gap narrows for the first time in seven years: ME Bank

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GUEST OBSERVATION
Might government benefits, and government employment, be a self sustaining machine – one in which those who benefit from government payments deliver the votes needed to ensure they continue?
It’s a proposition seriously put forward by researchers at the Centre for Independent Studies in a new paper entitled <a href="http://www.cis.org.au/publications/policy-papers/voting-for-a-living-a-shift-in-australian-%20politics-from-selling-policies-to-buying-votes/" target="_blank">Voting for a living: A shift in Australian politics from selling policies to buying votes?</a>
The paper argues “there are now so many beneficiaries of government largesse that they may constitute a political force strong enough to bias policy outcomes”.
It also says “when the number of public sector employees is added, there is a clear majority of voters benefiting more from government than they contribute.”
The authors reckon they’re on to something.
They use <a href="https://www.propertyobserver.com.au/http://www.abs.gov.au/ausstats/abs@.nsf/mf/6537.0" target="_blank">Australian Bureau of Statistics data</a> to conclude that “the emergence of a large segment of the population that may in a sense ‘vote for a living’ could help explain much that has gone awry with public policy”.
Amplifying their argument in a column in the <a href="https://www.afr.com/opinion/columnists/when-buying-votes-replaces-selling-policies-%2020180912-h15aan" target="_blank">Australian Financial Review</a>, they ask whether the government’s decision to abandon raising the pension age was “an example of what may happen in a democracy when an increasing majority of its voters receive net benefits from government […] while only a diminishing minority is left to pick up the net tax burden?”
A new idea it is not
The argument has been around for a while.
In August 2016, <a href="https://www.propertyobserver.com.au/http://www.abc.net.au/radionational/programs/drive/australias-new-divide,-the-taxed-and-%20taxed-not/7786370" target="_blank">then treasurer Scott Morrison</a> told us “more Australians are likely today to be net beneficiaries of the government than contributors – never paying more tax than they receive in government payments”.
He spoke of “a new divide”, between the taxed, and the taxed-nots.
The Heritage Foundation in the United States has argued there is a divide for a decade or more. And the argument goes back further, to the first half of the 19th Century and the American politician and political theorist <a href="https://www.propertyobserver.com.au/https://www.jstor.org/stable/40751557?seq=1#metadata_info_tab_contents">John C, Calhoun</a>.
But it is based on a misunderstanding.
In every system, everywhere, there’s zero net tax
The ABS stats do indeed show that close to half of the population <a href="https://www.propertyobserver.com.au/http://www.abs.gov.au/ausstats/abs@.nsf/mf/6537.0" target="_blank">receives more in cash benefits than it pays in income tax</a>.
If benefits in kind such as education and health care are included, and also indirect taxes such as the goods and services tax, the proportion climbs to 70-80%, at any point in time.
But it isn’t the same 70-80%, and it is unconnected to the size of government and the progressivity of the tax system.
To clear up some myths and misconceptions, the Tax and Transfer Policy Institute at the Crawford School at the ANU published <a href="https://taxpolicy.crawford.anu.edu.au/files/uploads/taxstudies_crawford_anu_edu_au/2016-%2011/zero_net_taxpayers_whiteford_nov_complete.pdf" target="_blank">a detailed policy brief</a> on the idea of “taxed-nots” in 2016.
Strikingly, it showed that a country’s share of “taxed-nots” was unrelated to its level of direct taxes and social security spending.
Australia’s 50% share of “taxed-nots” was similar to the share in the United States, and in New Zealand, and in Sweden – countries each of which have very different tax and spending systems.
The tax take has little to do with it
Korea and Denmark both had low shares of “taxed-nots”, at under 40%, but Denmark’s spending and tax was seven to eight times Korea’s.
The reason the share of “taxed-nots” has almost nothing to do with the level of spending or tax is that (as long as the budget is roughly balanced), by definition, the population on average has to pay zero net tax.
It makes no difference whether tax revenue is 46% of GDP as it is in Denmark or 26% of GDP as it is in Korea.
It is also not relevant how progressive the tax and social spending systems (that take less from low earners and give more to low earners) actually are.
Imagine a country in which everyone paid a flat poll tax, and the only spending was on goods with shared benefits, such as defence and public order.
In such a completely non-redistributive system, 100% of the population would be zero net taxpayers.
Zero net tax is hard to avoid
Far from being unusual or unsustainable, a situation in which a majority of taxpayers pay no net tax is close to unavoidable.
And the taxed and taxed-nots change places.
In Australia (as in all other high income countries) about 90% of households aged 65 or over receive more in public spending than they pay in tax. Most of them paid more tax than they received in public spending when they were younger.
The recent <a href="https://www.pc.gov.au/research/completed/rising-%20inequality" target="_blank">Productivity Commission inequality report</a> found more than one third of Australians spent at least one year in the richest 10% of the population between 2001 and 2016.
More than half of those who were in the richest 20% in 2001 where in the bottom half by 2016.
Today’s taxpayer is tomorrow’s taxed-not
Almost nobody stayed in the same income group for his or her entire working life.
Economic status changes when people finish study and get jobs, get promoted, lose jobs, raise families, marry, become sick, and become disabled or retire.
The concept of the “taxed-nots” or “net benefit recipients” sounds scientific, but isn’t a meaningful guide to anything very much.
This doesn’t mean we can’t work to improve our tax and spending systems.
But it does suggest if we want to improve them we need to be clear about how they work.<img src="https://counter.theconversation.com/content/103910/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Peter Whiteford, Professor, Crawford School of Public Policy, Australian National University
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/relax-the-divide-between-the-taxed-and-the-taxed-nots-isnt-new-and-doesnt-buy-elections-103910" target="_blank">original article</a>.
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The divide between the taxed and the ‘taxed-nots’ isn’t new and doesn’t buy elections

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GUEST OBSERVATION
The Productivity Commission – the Australian government’s highly influential economic advisory body – released a report titled Rising Inequality? last week. The question mark indicates its scepticism about other research findings on rising inequality in Australia. The commission responded to its own question in the report’s very first heading: “Over nearly three decades, inequality has risen slightly in Australia”.
This conclusion has left commentators divided. Some have celebrated this finding. Others, such as Peter Whiteford and Ross Gittins, argued the true picture is more complex.
We wish to point out one major flaw in the Productivity Commission’s conclusion. It ignores the deeply polarising impact of the housing boom on Australia in recent years. Our analysis shows that, once rent and mortgage costs are deducted, the rate of increase in average equivalised disposable income of the top 10% of households was 2.7 times faster than for the bottom 10% between 1988 and 2015.
On average, capital city house prices have doubled since 2003. This has benefited affluent homeowners and has disadvantaged lower-income households, especially those in long-term private rental.
Housing costs undermine gains for low-income households
We examined changes in income inequality using the same method and dataset that the Productivity Commission used, with only minimal technical differences. From 1988 to 2015, average equivalised incomes for households in the lowest 10% of incomes increased by 54%, compared with 85% in the highest decile. Such a difference is by no means “slight”.
However, to reveal the full extent of rising inequality, we conducted further analysis, deducting housing costs from income. This included both rent and mortgage repayments. The results were striking: from 1988 to 2015, average after-housing disposable incomes increased by only 30% in the lowest decile, compared with 81% in the highest decile.
This analysis shows that income inequality between the highest and lowest deciles nearly doubled once housing costs are taken into account. These costs hardly affected rising incomes for the top decile. For the bottom decile, housing costs nearly halved any gains in income over the same period.
Between these extremes, as the chart below shows, there is a very linear pattern across the spectrum. Housing cost impacts on disposable incomes decline as household incomes rise.
<img src="https://images.theconversation.com/files/234735/original/file-20180904-41717-1e1h69e.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" alt="">
Rising gap in disposable income, before and after housing costs, 1988-2015. Authors' estimates using:ABS Microdata: Household Expenditure, Income and Housing, 2015-16 (Cat. no. 6540.0, as at 3/08/18) and ABS HES Basic confidentialised unit record file for 1988-89 (as at 3/08/18)
Housing costs account for a much higher share of lower-income households’ income. Furthermore, at the bottom end of the distribution, renters have seen their rental costs increase. This has been fuelled by low vacancy rates and the absolute supply shortage of affordable rental housing.
In contrast, at the upper end of the distribution, home buyers have seen their mortgage repayments decline. This is thanks to lower interest rates and the slow but typically steady reduction in housing costs across the life course as owners pay out mortgage debt. Outright owners have not been impacted by housing costs either way.
House price growth boosts gains for wealthier households
The housing boom also played a key role in the rise of wealth inequalities, which are more extreme than income inequalities.
The Productivity Commission’s report shows that, since the early 2000s, the wealth of households in the top 50% grew faster than the bottom half. The upper deciles experienced average annual growth close to 3%. In contrast, the bottom decile experienced negative growth.
By 2015-16, those in the top 10% owned 45% of wealth. The bottom half of the distribution owned just 11%.
Property ownership rates are higher in the middle and upper deciles. For these households, house price growth made a major contribution to rising wealth.
In contrast, property ownership rates are relatively low in the bottom deciles. These households saw little or no wealth gains from the housing boom.
The report’s headline claiming only a “slight” rise in inequality over three decades seems to ignore this widening wealth gap as a crucial aspect of the story.
A national affordable housing plan is needed
Over nearly three decades of economic growth, living standards have improved for Australians across the board. This is good news.
But inequality has also risen significantly, which is bad news. Inequality creates unfair advantage for wealthier households and is deeply damaging for the social fabric, democratic stability and economic drive of our society.
Our analysis highlights the polarising impact of the housing boom, in two primary ways. Firstly, increasing housing costs undermined income gains for less affluent households. Secondly, house price growth increased wealth gains for more affluent households.
This analysis shows that rising inequality cannot be redressed without some redistribution of housing wealth and costs.
The Productivity Commission report commended the “equalising effect” of Australia’s progressive income tax. Including housing in our analysis, however, points to the polarising effect of taxation on wealth and housing. The tax system disproportionately benefits more affluent home owners and property owners.
An increased supply of affordable rental housing is crucial to reduce the gap in after-housing disposable income. Low-income private renters also need greater security of tenure, including more stringent controls on rent increases.
A renewed focus on affordable home purchase schemes for people on moderate incomes can help reduce the wealth gap. In addition, housing tax levers, used well, can help reduce both wealth and income inequalities over time.<img src="https://counter.theconversation.com/content/102581/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important;">
Ilan Wiesel, Senior Lecturer in Urban Geography, University of Melbourne
Liss Ralston, Urban Statistician, Centre for Urban Transitions, Swinburne University of Technology
Wendy Stone, Associate Professor, Centre for Urban Transitions, Swinburne University of Technology
This article is republished from <a href="http://theconversation.com" target="_blank">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/how-the-housing-boom-has-driven-rising-inequality-102581" target="_blank">original article</a>.
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How the housing boom has driven rising inequality

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GUEST OBSERVER
The Reserve Bank of Australia should have a board member whose job it is to “represent the poor”, says Catholic Social Services Australia in a report released this week.
This hasn’t been tried before but it’s an interesting proposal and worth considering – particularly as recent central banking programs like quantitative easing have inflated the value of assets belonging to the very rich, exacerbating inequality and even threatening democracy.
The report is part of a continued effort by Catholic Social Services Australia to draw attention to those disenfranchised by an increasingly winner-takes-all society.
In fact, the entire notion of “trickle-down economics”, in which poorer sections of society supposedly benefit from policies that help the rich, is increasingly disputed.
Central bankers overlook inequality
Central bankers historically have not considered economic equality to be a key concern, and have been described (somewhat generously) as “innocent bystanders”. This does not really make sense, as central bank policies have statistically significant impacts on aspects of inequality including household income and consumption.
Central bankers tend to have a narrow focus, restricted to managing a small set of macroeconomic variables, and inflation in particular (which they refer to as “price stability”). Unfortunately, even after the global financial crisis, many central banks have continued to focus on inflation at the expense of a more complex economic picture, including inequality.
Central bankers are also very conscious of the need to maintain credibility. This involves presenting the board of a central bank as a group of “experts” with a long-term economic focus. Their expertise tends to be heavily tilted towards traditional economics, and they are influenced by traditional economic ideologies that do not emphasise inequality.
For example, central bank policies that focus on inflation and economic output (GDP) are limited by the fact that they do not capture the nature of unequal social conditions.
As we can see from the minutes of central bank board meetings, members do disagree and present dissenting views. However, having a representative for the poor on the board would challenge the general consensus in a new way.
A seat for the poor
In arguing for a “seat for the poor” there are several elements that need to be unpacked.
The first is the question of central bank accountability. Having a seat for the poor means that there would be a person on the board constantly questioning and challenging the other members. This is known as horizontal accountability because it is a type of oversight among equals.
As central banking involves involves deliberation among policymakers of equal rank, horizontal accountability can be an effective way for them to regularly check one another’s actions. If an “ambassador of the poor” regularly questions other board members it could keep them on their toes even if it doesn’t always sway their decisions.
The next question is around the tools and metrics that a board member representing the poor would use to present dissenting views. If the board member draws on the usual metrics that central bankers monitor, such as labor market figures and general price levels, they might arrive at similar viewpoints to their peers.
On the other hand, if this board member used metrics centered on inequality, it could be extremely beneficial to the deliberations and help to realign policy. These metrics could include income distribution, savings behaviour, welfare dependency, and socioeconomic variables - including healthcare and education outcomes.
How would we pick a representative of the poor? How would this person display and maintain their professional credibility? How would they juggle broader macroeconomic concerns with their own ideological inclinations?
The idea that a person appointed by the church should intercede in deliberations over monetary policy is antiquated at best. So the mechanisms for appointing such a person need to be carefully addressed.
Where the poor really need representation
The past few years have shown that central bank policy has a large impact on inequality. If anything, in Western countries it has made inequality much worse, as the benefits of stimulus programs have disproportionately gone to the very richest.
But it is actually fiscal policy (otherwise known as government taxation and spending), and not central bank policy, that is the best tool for addressing inequality.
This is because decisions on taxation and payments are a more direct method for addressing inequality. Progressive programs such as basic incomes, universal healthcare and public education directly impact peoples’ lived experience.
If anything, it is fiscal policy that most needs a “representative of the poor”.
Fiscal policy is so abjectly political and so deeply entrenched that a “depoliticized” fiscal regime only exists in the fantasies of academics (my own included).
<img src="https://counter.theconversation.com/content/85992/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1">Nevertheless, if we want to make a real dent in inequality, it is only possible when fiscal policy is fully committed as well.
Usman W. Chohan is an economist at UNSW.
This article was originally published on <a href="https://theconversation.com" target="_blank">The Conversation</a>. Read the <a href="https://theconversation.com/should-central-banks-have-a-representative-of-the-poor-85992" target="_blank">original article</a>.
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Wealth Inequality

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