A leading economist has given a blunt explanation as to why the election promises of the two major parties aren’t enough to help young Aussies buy their first home.

The Australia Institute executive director Richard Denniss argued that Labor and the Coalition’s promised policies such as tax breaks only benefit current property owners and described it as a ‘cruel hoax’ on the ABC’s Q+A on Monday night.

Frustrated viewer Georgia Haysom told the panel she’d been working full-time and regularly saving for several years but was still unable to afford a home.

‘As a 25-year-old, full-time teacher I’m doing everything right – working hard, saving where I can and trying to get ahead,’ she said.

‘But when even with a stable job I’m finding it near impossible to break into the housing market, how can young Australians like me hope to own a home when wages haven’t kept up with the cost of living?’

Mr Denniss doesn’t believe that the policies of either major party will substantially help struggling young Aussies such as Ms Haysom.

‘Imagine you’re at an auction and you gave everyone $10,000, the only person you’ve helped is the person selling the house,’ he began.

‘Whether it’s everybody, whether it’s investors through the capital gains tax breaks, whether it’s some first homeowners… we give some people a bit of cash we make them feel great.

Economist Richard Denniss (pictured) explained why measures like tax breaks only benefit current property owners

Economist Richard Denniss (pictured) explained why measures like tax breaks only benefit current property owners

Full-time teacher Georgia (pictured) said she's saved for several years but can't afford to buy a home

Full-time teacher Georgia (pictured) said she’s saved for several years but can’t afford to buy a home

‘You’re just changing who misses out at the auction.’

Mr Denniss doubted whether the May 3 election would bring any real solutions, regardless of the result.

‘I’m sorry that you’re in that situation and I’m sorry that in the middle of an election campaign we’re not actually talking about how to fix that for you and so many people like you,’ he told Ms Haysom.

‘But let’s be clear, 10 years ago (then-federal treasurer) Joe Hockey said if you can’t afford a house, go and get a better job.

‘We did the numbers on this and if you’d have taken his advice at the time and you had a an average full-time wage job and for the last 10 years you’d been saving – you’d be $1,000 further away from a deposit on an average house in Sydney today.’

‘This is not complicated – as long as house prices are rising faster than wages you can’t catch up.

‘I’m sorry but it’s a cruel hoax for people to tell you that a tax break here or something or other there is going to help.’

Mr Denniss believed the only way to help young Aussies achieve their dream of owning their own home is to keep house prices in line with the average income. 

Mr Denniss compared policies like tax breaks to giving everyone at an auction an equal bonus

Mr Denniss compared policies like tax breaks to giving everyone at an auction an equal bonus

‘House prices in Australia have risen so much faster than incomes that a whole generation’s been left behind,’ he said. 

‘As long as house prices are rising faster than wages, you can’t catch up.’

Melbourne deputy lord mayor Roshena Campbell agreed it was common problem facing millennials.

‘Voters younger than us have the deep despair we’re not going to have it as good as our parents did,’ she said.

‘I think that’s a crisis in this nation – it’s a crisis of lack of hope. 

‘I’m not surprised this has become a housing policy election.’

Cr Campbell added she has found hope in the election discussion to date. 

Host Patricia Karvelas (pictured) questioned if either of the major parties' election policies would help first-time homeowners

Host Patricia Karvelas (pictured) questioned if either of the major parties’ election policies would help first-time homeowners

Housing minister Clare O’Neil and Coalition spokesman Michael Sukkar then attempted to win over Ms Haysom by spruiking their party policies.

‘Georgia, you have been campaigned to individually,’ Q+A host Patricia Karvelas quipped.

‘I want this woman to get a house!’

Ms Haysom raised her concerns after Labor and the Coalition both made big housing policy promises over the weekend.

Opposition Leader Peter Dutton announced that first-home buyers would be able to claim interest repayments as a tax deduction, on a loan of up to $650,000, provided it is a brand new property.

Prime Minister Anthony Albanese then announced a five per cent deposit for all first home buyers and a $10 billion pledge to go towards building 100,000 new homes that will be available only to that cohort.

 

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