The current housing debate in Australia has narrowed dramatically to the point where the only politically palatable option is to avoid affordable housing policy. The de facto policy is to rely on private rental and ownership as the only housing options in the country. One current approach is to provide tax breaks to developers to facilitate a build-to-rent model, rather than the typical build-to-sell arrangements.1 What makes this approach quite strange is that there are already 1.8 million landlords in Australia (or around 20% of households).2 Under the build-buy-rent model, such investors enjoy generous tax concessions, like the 50% capital gains tax discount and negative gearing losses against labour incomes.

Providing more tax breaks for another set of landlords, this time landlords who are also developers, further entrenches the narrow scope of options to simply more tax-advantaged marketpriced private housing. It seems far removed from a policy designed to engineer secure low-cost housing. Unfortunately, relying on private property markets to deliver affordable housing is like relying on the fox to watch the hens. Private property markets that provide access to land and housing through competitive pricing are the problem, not the solution, when it comes to providing cheaper housing options. Land markets are a monopoly, with landholders able to withhold land for the maximum price that comes from buyer competition. The market price of land is the monopoly price.