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The 95% Mortgage Cliff

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During this session with Housing Australia, I call out the lack of transparency and the questionable math behind the home deposit guarantee schemes.

I asked Mr Langford why it took nine weeks to get an answer to a simple question: how many borrowers have exited the scheme? They finally admitted that of the 185,000 guarantees issued since the scheme was launched, over 45,000 have already been discharged.

I’m highly sceptical of their reported “success” rates. They previously claimed that there were only 11 defaults out of 250,000. The actual arrears rate on bank loans is around 1% – 227 times higher than the claimed arrears rate of 0.0044%. Therefore, it’s statistically impossible!

My point is simple: they don’t actually track people once they exit the scheme, so they’re essentially flying blind when it comes to the data.

Despite Minister Ayres’ attempts to paint every exit as a “success story,” the data proves it’s not that simple.

As at the end of December 2025: ❌ 0.3% or 336 of borrowers are 90+ days in arrears, ❌ 0 .8% or 1000 are currently under hardship arrangements and ❌ 347 are in early-stage arrears (30–90 days).

While they boast that many are ahead on payments, I’m concerned about the “cliff” ahead.

When I asked for modelling on what happens to these 95% mortgages if interest rates rise three more times this year, they admitted they have no modelling for that scenario.

Ms Jarman has committed to providing me with a copy of the information guide for first-home buyers. I want to see for myself if it properly warns Australians about the massive risks of a 95% mortgage in a rising-rate environment.

— Senate Estimates | February 2026

Transcript

CHAIR: I’m going to rotate the call. Senator Roberts.  

Senator ROBERTS: Thank you, Chair. Thank you for appearing again today, Mr Langford. You undertook at the last hearings to answer on notice how many borrowers under your two and five per cent deposit guarantee scheme have exited since the program started. That was question on notice 458. That should be a number you have to hand very easily. You haven’t answered it in the nine weeks since the hearing. Why not?  

Mr Langford: I’ll ask my colleague Ms Jarman, who has just come to the table, if we have that information to hand. As to the delays, we apologise. There may have been some delay if we didn’t have that information to hand.  

Ms Jarman: Sorry, Senator—can you repeat exactly what information you’re after?  

Senator ROBERTS: You undertook at the last hearings to answer on notice how many borrowers under your two per cent and five per cent deposit guarantee scheme have exited since the program started. That was question on notice 458. I’d like the number, please.  

Ms Jarman: Yes, we do have the number that have exited. Of the 185,000 guarantees that have been issued since the launch of the scheme, 45,837 of those have discharged.  

Senator ROBERTS: You told me at the last hearing that there were only 11 defaults out of 250,000 guarantees issued. The actual arrears rate on banks’ loan books is around one per cent. That’s 227 times higher than your claimed arrears rate of 0.0044 per cent. Do you accept that your number is almost statistically impossible and only appears good because you don’t actually track the people who exit the scheme? Once they’re gone, they’re gone.  

Senator Ayres: Exiting is good.  

Senator ROBERTS: You don’t track them once they’re gone.  

Senator Ayres: These are people who have bought a home—  

Senator ROBERTS: Don’t try and change the topic. I’m asking the question. I want to know—  

Senator Ayres: under the scheme, then sold their home and moved on to their next home. That is the foot on the ladder that the scheme is designed to provide.  

Senator ROBERTS: Minister Ayres, at the last hearing, you said—  

Senator Ayres: That’s what it’s for.  

Senator ROBERTS: that people who are facing hardship can’t refinance. Do you know that that’s false?  

Senator Ayres: What do you mean?  

Senator ROBERTS: ‘People who are facing hardship can’t refinance,’ you said. That’s false.  

Senator Ayres: I said that people who are facing hardship can’t refinance?  

Senator ROBERTS: That’s what you said. 

Senator Ayres: I don’t know what context I said that in. You’re moving—  

Senator ROBERTS: Can you update me on—  

Senator Ayres: from one proposition, demonstrably not the case—  

Senator ROBERTS: And you’re changing my proposition. I’m trying to get on with it.  

Senator Ayres: which is that it’s a bad outcome.  

Senator ROBERTS: Why are you running from this, Minister Ayres?  

Senator Ayres: No. I’m running to this. I’m running to this. This is a good outcome.  

Senator ROBERTS: You changed my first proposition.  

Senator Ayres: This is a good outcome. I’m sorry if you’re confused about it. This is a good outcome for young Australians. 

Senator ROBERTS: I think you’re misleading.  

Senator Ayres: Buying a home, selling a home, buying a new one—this is a good outcome.  

Senator ROBERTS: Can you update me on your latest percentages for in advance, on schedule, in arrears and hardship?  

Ms Jarman: I can do that. As at the end of December, 0.3 per cent of the portfolio were 90 days plus in arrears, 0.8 per cent were under hardship arrangements, 26 per cent of the portfolio were on schedule with payments and 73 per cent were in advance of their repayment schedule.  

Senator ROBERTS: Do you also have the actual numbers each of these percentages represent?  

Ms Jarman: I do.  

Senator ROBERTS: Could we have them please?  

Ms Jarman: Sure. We had 33,134 on schedule, 93,104 in advance, 336 ninety days in arrears and 1,000 in hardship. There is another category, for completeness. If you’re adding up to the total number of guarantees, in arrears of 30 to 90 days—so early arrears—there are another 347 customers there.  

Senator ROBERTS: How many total guarantees are those percentages of—is it less than the 250,000?  

Ms Jarman: The 250,000 is the number of Australians supported under the scheme. We’ve only ever issued 185,000 guarantees, but only 127,000 of those are active in the book at the moment. The rest of those have already discharged out of the scheme.  

Mr Rimmer: I gave evidence earlier in the day that the 0.3 per cent 90-day arrears rate is better than the other relevant arrears.  

Senator ROBERTS: Thank you. I heard that.  

Senator Ayres: I also should have said, Senator, again for the sake of completeness, that people exit the scheme if they sell their home. They also exit the scheme when they hit the 80 per cent loan-to-value ratio. That is, they come in at five per cent and make repayments that pay the 15 per cent gap over time, and then they’re considered to have exited the scheme. That’s also a good thing.  

Senator ROBERTS: How many five per cent mortgages that you got first home buyers into do you expect a default if interest rates are raised three times this year?  

Senator Ayres: Your One Nation colleague asked the same questions about an hour and three-quarters ago.  

Senator ROBERTS: He actually said ‘if we are entering a cycle’. I want to know what would happen with three interest rate rises.  

Mr Langford: I don’t believe we have modelling for that proposition that you’re putting forward.  

Senator ROBERTS: Do you, as the administrator of the five per cent deposit guarantee, provide first home buyers with any warnings about the risk of a 95 per cent mortgage?  

Ms Jarman: Yes, we do. As part of the application process, we’ve got an information guide. That guide clearly outlines what the guarantee is and how the guarantee is there to protect the lender and not the borrower. It also outlines the obligations of the borrower in terms of repayment of the mortgage and the circumstances in which the borrower is still liable.  

Senator ROBERTS: Could I have a copy of that on notice, please? 

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The Debt Trap: Labor Government’s Housing Mirage

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I have expressed grave concerns that we are signing our young Australians up to be “debt slaves” to the big banks. It’s one thing to offer a “leg up” onto the property ladder, but it’s another thing entirely to push them into a lifetime of unmanageable debt.

During my questioning of Housing Australia, I pointed out a massive flaw in how they report their success. The department “brags” about a low default rate — only 11 claims out of 250,000 — yet admit that they stop tracking borrowers the second they refinance or exit the scheme. Think about that. If the families under the most financial stress are the ones forced to refinance or leave, they vanish from the government’s data. We’re essentially flying blind, ignoring the very people who might be “going backwards.”

I’ve said it before on the Senate floor, and I’ll say it again: this scheme is “smoke and mirrors.” Pumping more low-deposit buyers into a market where there aren’t enough houses to go around, the government is just upping the price of entry-level homes. This completely ignores the root of the problem—supply, caused by mass immigration. We’re watching house prices increase and the very people this was meant for— the younger Aussies — can’t even afford the ‘starter’ homes.

I’m not going to let this rest. We need to see the real numbers, not just the cherry-picked stats that make the government look good.

Australians deserve to know if their “dream home” is actually a debt trap.

— Senate Estimates | December 2025

Transcript

Senator ROBERTS: I’ll try to be brief. I refer to data on how people who are taking on these 95 per cent mortgages are actually faring, because I have grave concerns that the government is just signing up first home buyers to be debt slaves to the banks. Firstly, does Housing Australia track participants who later refinance or discharge their lower deposit guaranteed loans with a different lender?

Mr Rimmer: I’ll pass that question to Mr Langford in a minute. The five per cent deposit scheme has been in place for five years now. Over 250,000 guarantees have been issued. Only 11 of those 250,000 have been paid, at a total cost of about $500,000, a relatively small amount of payment per claim. Out of all 250,000 Australians who were supported into purchasing a house through this program, 11 have fallen into very significant arrears.

Senator ROBERTS: If you don’t track participants who later refinance, how do you avoid a survivorship bias in your arrears metrics if the borrowers most at risk of stress are those who refinance?

Mr Langford: We only have a relationship with the borrower until the point they exit the scheme. There is no ability for us to track what happens to them beyond that.

Senator Ayres: For everybody who enters the scheme, it’s their first home. It’s not unusual for somebody to refinance. They have their foot on the ladder, so they might go and buy a larger home, a different home, a home in a different country town or whatever it is. If you are apprehensive that there might be something in addition to the 11 out of 250,000 people experiencing difficulty, everybody who has a mortgage, every Australian has challenges from time to time meeting their mortgage—

Senator ROBERTS: We certainly do.

Senator Ayres: That’s right. These people are no different from everybody else. It’s just that they’ve got a leg up because they fit the criteria of the scheme. Of course, we want them to have that first step on the ladder, to grow—to grow families and to grow in opportunity. That’s a good thing.

Senator ROBERTS: My concern is if we’re tracking to see whether they’re getting a leg up or a push down. That’s what I want to track.

Senator Ayres: The evidence in this scheme is that—

Senator ROBERTS: I’m trying to go through this quickly for the sake of everyone. Could you please provide on notice counts by year since 2020 of scheme backed loans refinanced or discharged?

Mr Rimmer: We’ll take on notice what information we have that could be useful to answer that question.

Senator ROBERTS: And where possible, with any available reason as to what they’re doing?

Senator Ayres: Yes, they’ll do their best to provide that to you.

Senator ROBERTS: That’s all we can ask for.

Senator Ayres: But don’t take it from that those are bad outcomes. Those are overwhelmingly good outcomes.

Senator ROBERTS: My office and I want to get the data to understand this.

Senator Ayres: We’ll do our best to provide what can be provided.

Senator ROBERTS: Your reports show the share of loans ‘in advance/on schedule/90-day plus arrears’. But you explicitly state you do not receive participants’ current income or valuation data and rely on lender hardship programs. Why is Housing Australia not collecting borrower-level hardship outcomes?

Mr Langford: In the way that the scheme’s designed the relationship is between the borrower and the bank. We are providing a guarantee ultimately to the lender. For a range of reasons, including privacy, we don’t get updated information from the applicants.

Ms Jarman: Further to that, each month we do get from the lenders the actual number of borrowers under the scheme in 90-day-plus arrears or in hardship.

Senator ROBERTS: Can you table or give me on notice the number of scheme participants flagged as in hardship by panel lenders by state and lender?

Ms Jarman: Yes. I don’t have the state breakdown here. I do have the overall number. We can take the state breakdown on notice.

Senator ROBERTS: And the resolution number? I don’t expect you to have the data here. How many scheme backed loans have progressed from arrears to default and resulted in a Commonwealth guarantee call?

Ms Jarman: Some 11 claims have been paid under the scheme since its start in 2020.

Senator ROBERTS: Could you provide the number and value of claims against the guarantee by financial year, and the cohort in terms of which guarantee scheme they are and geography?

Ms Jarman: Yes, we have that data.

Senator ROBERTS: You’ve previously told me that roughly 61.5 per cent of scheme loans are ahead, 38.4 per cent on time and 0.1 per cent in 90-day-plus arrears at a point in time. Do you have an update on those figures?

Ms Jarman: We do. As at the end of October, the in-advance number is 75 per cent of all loans, the on schedule is 23 per cent, the arrears number is 0.6, and the hardship number is 0.8.

Senator ROBERTS: What’s the cohort composition behind those figures—loan age, borrower, income band?

Ms Jarman: I don’t have that breakdown in front of me.

Senator ROBERTS: Can we get that on notice?

Ms Jarman: Yes, we could provide further detail there.

Senator ROBERTS: Debt-to-income and loan-to-value at origination versus latest?

Senator Ayres: Just at an aggregate level.

Senator ROBERTS: Per year.

Mr Langford: Do you mean per year of origination?

Senator ROBERTS: Yes.

Mr Langford: We’ll do our best to provide what information we have on notice.

Senator ROBERTS: Without longitudinal borrower data, these metrics really are incomplete. Can you provide distribution tables for scheme borrowers by debt-to-income bands, loan-to-value ratio bands and income quartiles at origination and latest available?

Ms Jarman: We can take that on notice.

Senator ROBERTS: The Reserve Bank finds that highly leveraged borrowers are most likely to fall into arrears in the current environment. Of your five per cent deposit borrowers, how many are in the bottom income quartile? That’s the one that the RBA refers to as going backwards.

Mr Rimmer: I’m sure Housing Australia will do their best to find that. My understanding is that the arrears rate for loans under this scheme is lower than the arrears rates in the market as a whole. My colleagues may wish to correct that if it’s wrong.

Ms Jarman: That’s correct. When we speak with our panel lenders, the feedback that they provide is that with the cohort of borrowers under the scheme the arrears performance is equivalent, if not favourable, to their other borrower cohorts.

Senator ROBERTS: We’d like to see that in the data.

Senator Ayres: We’ll certainly provide that, but that’s the evidence that’s been given time after time on this question and it fits with our experience. Working people are very disciplined about meeting their mortgage commitments.

Senator ROBERTS: They certainly have good values.

Senator Ayres: And that’s what’s going on here. That is a very good story, and an improvement on the last set of figures; 75 per cent of Australians are ahead as a result of this scheme. That’s a very good outcome.

Senator ROBERTS: What proportion of arrears and defaults sit in the going backwards quartile?

Ms Jarman: Sorry. What do you mean by the ‘going backwards’ quartile?

Senator ROBERTS: The bottom income quartile.

Ms Jarman: I don’t have any arrears data broken down by borrower cohort in front of me.

Mr Langford: If there’s a range of these statistical matters that you’re interested in, we’d be very happy to receive those and see what we can provide.

Senator ROBERTS: I’ll put them in writing for you.

Mr Langford: That would be much appreciated.

Senator ROBERTS: Have you run stress tests for the guarantee book to estimate how many will go from on time to arrears or default by quartile and debt-to-income or loan-to-value ratio bands?

Ms Jarman: Yes, every year.

Senator ROBERTS: Could we get that?

Ms Jarman: Yes, you can.

Senator ROBERTS: Once a participant refinances or exits, does Housing Australia have any visibility of their subsequent hardship or default outcomes?

Ms Jarman: No, we don’t.

Senator ROBERTS: How can parliament be confident that public reporting is not undercounting stress by removing the most vulnerable borrowers from your data?

Senator Ayres: You can’t refinance if you’re in hardship, right? That’s not a realistic thing to happen. If somebody can’t meet their obligations, they won’t get refinanced; 11 people haven’t met their obligations out of the 250,000. If they purchase a new home, they’re not doing it under the scheme, they’re doing it using the improved equity. People point to bad outcomes out of house prices going up, but there are good outcomes. House prices lift, they get increased equity, they get up the next step on the housing ladder, and then they’re out of the scheme. That’s a good thing. There’s no downside to either of those propositions. We’ll provide what we can. I understand the point you’re making.

Senator ROBERTS: Could you please provide counts on notice of scheme loans exited via refinance and any post-exit arrears or default?

Ms Jarman: We can provide the discharge reason, but I can’t provide information once they’ve discharged. I don’t have visibility of that from the lenders.

Senator ROBERTS: You can’t get it from the lenders?

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Building a Better Future: Community Discussion Night

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Are you concerned about the future of Australia? Don’t miss this excellent opportunity to voice your concerns, share your ideas, and be part of the conversation.

I will be joining Brendan Kross, One Nation’s Federal Candidate for Blair, at Falvey’s Hotel Yamanto in Ipswich on Saturday, 5 April 2025.

RSVP here: https://senroberts.com/42kV1Al

Planning to dine in? Give the hotel a call at (07) 3288 9123 to reserve your table.

Let’s work together towards a brighter future for our nation.

I look forward to seeing you there!

🗓 Saturday, 5 April 2025 | 🕕 5:30 PM

📌 Falvey’s Hotel Yamanto

406 Warwick Road, Yamanto QLD 4305

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Australia’s Living Standards Decline

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Throughout my entire time in the Senate, I’ve consistently spoken on the need to restore Australia’s productive capacity through the construction of new infrastructure.

It’s a simple metric: the living standard of each Australian is expressed as our gross domestic product divided by the population. With 5 million new Australians in the last 10 years – 2.5 million under this Labor government – our gross domestic product is being split into more slices for the new arrivals faster than it is growing.

As a result, the standard of living for individual Australians is going backwards and has fallen by 8% since Labor took over. Did anyone hear Prime Minister Albanese promise in his 2022 election campaign to reduce the living standards of everyday Australians by 8%?  I didn’t.

The answer to falling living standards is to reduce immigration.

The Government must also embrace the other side of the equation, which is building new infrastructure to enhance our productive capacity.

This video explains One Nation’s ‘build baby build’ policy, which we are taking to this election.

Transcript

I thank Senator Rennick for this opportunity to speak about One Nation’s policies and note that, in March, his statements and policies are becoming increasingly loaded with One Nation policies that we released earlier the month before, in February. In that, it’s like Labor and the LNP too, who are copying elements of our policies. 

For the entire time I’ve been in this Senate, I’ve spoken on the need to restore Australia’s productive capacity through the construction of new infrastructure. It’s a simple metric: the living standard of each Australian is expressed as our gross domestic product divided by population. With five million new Australians in the last 10 years, 2½ million of those under this Labor government, our gross domestic product is being split into new slices for the new arrivals faster than it’s growing. As a result, the standard of living of individual Australians is going backwards and has fallen by eight per cent since Labor took over. Did anyone hear Prime Minister Albanese promise in his 2022 election pitch to reduce the living standards of everyday Australians by eight per cent? I didn’t. The answer is clearly and certainly to reduce immigration, although the government must embrace the other side of that equation as well, which is building new infrastructure to grow our productive capacity. 

One Nation are taking a platform to this election that includes building a national rail loop to take hundreds of thousands of truck movements off the roads, making freight handling cheaper and more efficient, reducing supermarket prices and making Australia more competitive. That’s vital in a large country with a small population; logistics is tops. Our platform also includes a new northern rail crossing from Port Hedland to Moranbah and the Port of Gladstone in Queensland to open the east Pilbara and the north-west minerals province in Queensland to the international market, facilitating exports worth hundreds of billions of dollars and tens or hundreds of thousands of breadwinner jobs. There’s also a multifunction corridor to take water, power and internet along the new northern crossing railway to bring town services to more than 100 remote communities across the Top End; Hells Gates Dam in Far North Queensland to provide flood mitigation, water security and hydropower; and the Urannah water project and pipeline, amongst others. What will be the source of these funds? There will be $90 billion from cutting waste and duplication, itemised. See our website; it’s fully costed. 

Each year, we will put $40 billion of that back into people’s pockets. For example, couples with children income-splitting will save almost $10,000 a year. It’s fully costed. Each year, we will invest $20 billion in infrastructure to increase productive capacity to increase our children’s wages. Each year, we will pay down record debt of $30 billion, which is estimated to become $50 billion the year after next per year, to reduce interest. Only through building our productive capacity can we hope to provide for the millions of new arrivals, generate new government revenue from increased economic activity and restore wealth and opportunity to all who call this beautiful country home. 

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Net-Negative Migration Will Ease Cost of Living Stress

★ Immigration is our special sauce ★ There’s a skills shortage ★ Multiculturalism is our strength

These are all lies told to the Australia people.

In reality, this insane migration program is the reason why Australians can’t afford a house, see a doctor on time or get their kid into a school.

No more! One Nation will make migration net-negative. Some of the temporary migrants need to return home so that our infrastructure and services can catch up with our population.

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Change Begins with Us and Together, We Can Achieve the Extraordinary

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An Evening of Dinner and Conversation! I’m joining Graham Healy and Dr William Bay for this event and I’d love for you to join us!

Just a heads-up: I’m not hosting this event. To RSVP, please use the external link to the Rise Up Australia Brisbane branch website: https://senroberts.com/4aG7L75

📅 Date: Sunday, 16 February

🕒 Time: 4:30 pm to 8:30 pm

📍 Location: Yum Cha Cuisine, Indooroopilly Shopping Centre, Shop MM5, 3A Station Rd, Indooroopilly QLD

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Labor’s ‘Rent to Buy’ Plan Will Increase Housing Prices

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The Help to Buy Bill 2023, introduced by the Albanese Labor government, will make Australia’s housing crisis worse. The bill proposes to allow the government to own a significant portion of the house – 30% for existing homes and 40% for new ones. Providing buyers with an additional 40% purchasing power will only drive up house prices further, as highlighted by the Productivity Commission’s warnings about increasing demand leading to higher prices.

The bill is also criticised for being poorly targeted and not addressing the fundamental issue of housing supply and demand. The limited number of spots available under this scheme suggests the government know it will introduce inflation. Key questions about how profits, losses, and renovations will be treated are unclear. Participants in this scheme could be far worse off.

One Nation proposes a way for all Australians to be able to afford a house. We focus on addressing both supply and demand issues. These include throttling the amount of immigrants in the country from their record highs to pre-COVID numbers (for a start), banning foreign ownership of Australian residential properties, allowing Australians to leverage their superannuation funds towards owning homes, establishing fixed 5% mortgages, cutting GST on building materials and gutting the bloated building codes.

Under the government’s “Help to Buy” bill, you’ll become a slave in your own home. Under One Nation’s plan, the Australian dream of owning your own home will become a reality.

Transcript

The Help to Buy Bill 2023 is a bill that won’t help anyone. Right now, Queenslanders are sleeping under bridges and on riverbanks. In one of the world’s richest states, working families with children are living in cars. Where do they toilet or shower? It’s inhuman. Rents are skyrocketing—if a rental can be found. House prices are reaching record highs. This is a housing crisis, one of the worst we’ve faced. It’s an inhuman catastrophe.  

The Albanese Labor government wants to look like it’s doing something. Enter the Help to Buy Bill. Under this plan the government wants to own a significant part of your house. If it’s an existing place, the government wants to own 30 per cent; if it’s a new place, 40 per cent—with the government paying for part of it with low-income earners. While a 40 per cent subsidy might sound attractive, it’s fatally flawed. If the government just borrows more money for this plan then one thing is going to happen. When you give people 40 per cent more money to buy a house, house prices are going to go up. The Bills Digest notes: 

In 2022, the Productivity Commission concluded that—unless it is well-targeted … assistance to prospective home buyers presents too great a risk of increasing housing demand and, consequently, house prices. 

The government’s own Productivity Commission warned them this plan would increase house prices. Even the Labor government recognises this. That’s why they’ve severely limited the amount of places available under the scheme—so that house prices aren’t drastically increased. There’s a contradiction right there. If the government is only opening limited spaces so there’s no impact on house prices, then it’s an admission the scheme will not help many people. 

The problem of increasing house prices is one of too much demand for the amount of supply. This bill will only increase the amount of demand and increase house prices. In the absence of more supply, we need to decrease demand, not increase it. As Dr Cameron Murray from Fresh Economic Thinking accurately said: 

If you want people to have cheap housing, give them cheap housing. You can go and do all the financial tricks in the world but at the end of the day if they’ve paid that price, someone’s paying the price. 

This bill’s core concept and premise is flawed and possibly a lie. We can’t subsidise our way out of a house price problem. 

Looking at the bill’s details or lack of details, the problem is worse. Firstly, let’s look at profit and loss and renovations. One of the most concerning questions is how the government will treat profits and losses and renovations. To these questions, this bill has no answers. How much of the profits will the government take if you sell your house? We don’t know. How much of the loss will taxpayers pay if house prices go down or the homebuyer defaults on their mortgage? Australian house prices have aggressively and consistently risen for 30 years. What if they fall? The bill is silent on how this would be handled. Would taxpayers be forced to pay for the entire loss on someone’s mortgage? The government basically acts as a mortgagor second to the bank. Does this mean the bank gets first call to recoup all their losses and the taxpayer simply has to cop the loss on whatever is left over? We don’t know. 

If someone improves the value of the house with renovations, does the government take 40 per cent of the improved value while doing nothing? We don’t know. Imagine tearing up carpets, swinging hammers and sanding with bare hands for six months or a year, and the government takes 40 per cent of the profits from that hard work of yours. That’s entirely possible under the bill as currently drafted. Under the government’s Help to Buy Bill, Australians could become slaves in their own homes. We cannot wait for this bill to be passed and a minister to make a decision later down the track. These matters must be clarified and explained in the bill. Homebuyers and taxpayers deserve to know what the risk is here. 

Secondly, let’s look at some criteria. The eligibility criteria are clunky and don’t cater for differences between states. The maximum income is set at $90,000 for singles and $120,000 for couples. This is despite the average house price and the required mortgage varying hugely between states and between towns. In Darwin, the average house price is $504,000. In Sydney, it’s $1.2 million, more than double, yet the same income thresholds apply. The price thresholds are not available in the bill, and it appears the government has not yet published thresholds. When it comes to the housing crisis, one size doesn’t fit all, yet that’s exactly what this bill tries to do. We’re just meant to pass the bill as a blank cheque and trust that the bureaucrats and the minister will get it right down the road—maybe. 

Thirdly, let’s look at the constitutional basis. This bill is completely outside the federal government’s power. Some reviewers have said that Help to Buy is built on a ‘complex constitutional foundation’. That may be the understatement of the year. Put very simply, under the Constitution, this is not the federal government’s job. To make this bill legal, there are a huge number of constitutional headaches, state government agreements and transfers of powers. Federal parliament simply shouldn’t be dealing with this. It’s outside of the powers granted to us under the Constitution. 

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Reserve Bank Governor Shifts Focus to People Rather than Spreadsheets

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Reserve Bank Governor Michelle Bullock was appointed to the position after a 20-year career in the Reserve Bank, including being the recipient of subsidised housing loans despite her substantial salary. Her early comments were reflective of her being “a long time in the public service bubble” and were out of touch with the hardships faced by everyday Australians due to past Reserve Bank policies causing high inflation and interest rates.

Her recent comments, however, appear to be much more in tune with understanding everyday Australians’ concerns.

At Senate Estimates, my questions were aimed firstly at getting updates on less reported projects and secondly, I wanted to know whether the Governor realised her role is about people not spreadsheets.

I found her responses encouraging and look forward to more people-oriented management from the Governor going forward.

Transcript

CHAIR: Thanks. Senator Roberts.  

Senator ROBERTS: Thank you for appearing. I missed you last time because I couldn’t get on the schedule. I want to get a quick update on as many things as possible. Part of the Reserve Bank’s process is to review inflation data and unemployment data. Do you use data from the ABS and, if so, do you use that data exclusively, or do you have other sources for unemployment and inflation data?  

Ms Bullock: We use ABS data obviously for inflation and unemployment. We use a variety of other sources of information, though, because we don’t just focus on the unemployment rate itself; we focus on a variety of measures that the ABS put out. We also focus on things like vacancies and advertisements. There’s information we get from our business liaison program, where we talk to businesses about what they’re doing with their labour forces: are they demanding more labour or not? So we use the ABS data, but we have a wealth of other information that we look at as well.  

Senator ROBERTS: Thank you. Business-to-business payment defaults and business bankruptcies, to the third quarter of 2024, are at a record. I’m sure you know that. Are you watching these metrics? And would these record figures act to reduce the appetite in the Reserve Bank for another interest rate rise?  

Ms Bullock: We do watch the business insolvencies data. My understanding is that they haven’t actually returned to the trend that they were prior to the pandemic. In the pandemic, with low interest rates and government assistance, insolvencies were actually at a record low. They have popped up, but they haven’t popped up to where the trend was going prior to the pandemic. So I think that’s important perspective to put it in. We do look at it and we look at it from a couple of perspectives. We look at it from the perspective of how monetary policy is impacting businesses, but we also look at it from the perspective of financial stability and the potential impact on banks, banks’ arrears and banks’ balance sheets.  

Senator ROBERTS: Thank you. Suicide Prevention Australia’s community tracker, also to the third quarter of 2024, shows a huge rise in the number of calls to help services, in suicidal behaviour and in clinical presentations. This is an independent and accurate barometer of how everyday Australians are doing. Are you aware of that tracker?  

Ms Bullock: Yes, I am. In fact I have regular meetings with various organisations—for example, Beyond Blue. They talk to us a lot about this sort of data. We also talk to ACOSS regularly, we talk to other charities in our business liaison program and we hear a lot about the fact that charities are seeing people come in who they haven’t seen before. So this is obviously an indication that they’re stressed. So, yes, we do keep in touch with that stuff. 

Senator ROBERTS: Can you update me on the state of the central bank digital currency, please? The last word we had was I think when Mr Debelle was deputy governor. I understand you’re developing a standard, not an actual currency itself? Is that correct?  

Ms Bullock: We’ve done a couple of things. We ran a pilot program with a real claim on the central bank last year. 

Senator ROBERTS: Is that what’s known as a ‘sandbox’?  

Ms Bullock: It was sort of like a sandbox, if you like. We had a number of different use cases. Various businesses came in with their use cases to use the central bank digital currency. From that information, what we took away was that probably the most fruitful piece of research we could continue with was the use of a central bank digital currency in a wholesale sense. By that I mean there’s a lot of discussion about putting assets on the ledger—for example, having a distributed ledger of financial assets—and then you could have a central bank digital currency which is used to make settlements of those financial instruments, or they might be physical instruments, physical assets. That’s the most fruitful work and that’s where we’re going at the moment. We’re in the process of standing up a project that looks at how a central bank currency could be used in the atomic settlement of assets. That’s where we’re going at the moment.  

Senator ROBERTS: So you’re not developing a standard?  

Ms Bullock: No. Basically, we’re looking at what the business case might look for. We’re not so interested in the technology and we’re not so interested in standards. What we’re interested in is: is there a business for this?  

Senator ROBERTS: Would that allow other parties, including each of the banks, to develop their own cryptocurrency?  

Ms Bullock: The banks themselves can develop what some people call ‘stable coins’, and some banks have developed stable coins. Central bank digital currency, if it were to be developed, would be something that everyone could potentially use—not literally every Australian, because, if we’re focusing on business, then it might be that some businesses can use it. Individual banks can, in theory, at the moment—and some of them have experimented with it—develop stable coins, which are effectively cryptocurrency. CHAIR: It’s your last question, Senator Roberts.  

Senator ROBERTS: This would not exclude existing cryptocurrencies, such as bitcoin?  

Ms Bullock: No. The central bank digital currencies would not have a relationship with bitcoin, no.  

Senator ROBERTS: But it wouldn’t exclude bitcoin?  

Ms Bullock: What do you mean by ‘exclude bitcoin’?  

Senator ROBERTS: To sideline them or remove them.  

Ms Bullock: No, bitcoin would continue to exist, but central bank digital currencies offer a different business proposition than bitcoin. Bitcoin has particular uses; central bank digital currencies would not be encroaching on that space, I suspect. 

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How One Nation Will Make Home Ownership a Reality for You!

The housing supply and affordability crisis is upon us and debating how we arrived here won’t help.

One Nation’s housing policy ‘looks to the future,’ offering common-sense solutions to help more Australians purchase their own home, while at the same time, reducing rent.  

Overview

  • Lower immigration to sustainable levels to reduce housing demand. 
  • Ban foreign ownership of residential property to increase housing supply. 
  • Allow a portion of your superannuation to be invested in a home purchase. 
  • Ditch Labor’s Housing Future Fund and invest those funds into creating a new People’s Mortgage Scheme, offering 5% deposit and 5% interest rate. 
  • Allow people with a HECS debt to roll their debt into a People’s Mortgage account, improving their ability to obtain and service a housing loan. 
  • Implement a 5-year moratorium on charging GST for new home construction, which will make new homes more affordable. 

The Role of Interest Rates in the Housing Crisis

The Reserve Bank understands that slowing down construction is an effective tool in reducing inflation and is doing so knowing it will make the housing crisis.  

This is what I mean when I say the Government is “stepping on the accelerator with handouts and government-sponsored construction,” at the same time the Reserve Bank is tightening the reins with higher interest rates. 

The result is a shambolic government from Anthony Albanese and Jim Chalmers. 

A shortage of home construction firms is also contributing to the problem. As of May 2024, there have been 2,500 building company bankruptcies | May of 2024 financial year. 

These failures are a result of rising material costs, approval delays, high interest rates affecting both the builder and the customer and a shortage of skilled labour.  Our immigration policy has brought millions of people into the country, however only a fraction of those migrants are qualified in construction trades.  

The Government’s answer involves a set of measures that “promise” many new homes, yet so far, only a few thousand have been delivered and they are mostly homes that were already in the pipeline. 

In other words, the Albanese’ Government’s efforts have made no meaningful impact on the crisis. 

One Nation’s approach will tackle inflation without relying on interest rate rises.  Refer to our inflation policy. 

The Role of Immigration in the Housing Crisis 

One Nation’s policy to address the housing shortage involves reducing immigration until the housing market stabilises.  

This strategy is grounded in logic that if we already have a limited supply of houses and we increase demand faster than new homes can be constructed, it will only lead to a worse housing shortage.  Even those who support high immigration should recognise that this approach makes sense. 

Anthony Albanese has overseen the arrival of 2.4 million new residents in just the last 2 years, creating a demand for 700,000 homes.  With home approvals at just 160,000 per annum, our housing shortage continues to get worse.  In turn, the worsening shortage will cause higher rents and higher home prices, putting home ownership or rentals out of reach for many everyday Australians.  

Rent controls discourages construction, making the problem worse. 

The graph below illustrates new housing approvals against population growth. Under Anthony Albanese’s Labor/Greens government, the number of home approvals has decreased while new arrivals have increased. This trend suggests that without the implementation of One Nation’s housing policy, the problem is going to get significantly worse for everyone currently living here. 

The Role of Foreign Buyers in the Housing Crisis 

During COVID, with immigration at such low levels, there was an opportunity for a “’catchup” – a period of construction without the pressure of increased demand.   

Despite this opportunity, no significant catch-up occurred, yet new homes were built.  So where did these homes end up?  

Part of the answer can be found in the August 2021 Census, which revealed that one million of Australia’s 10.8 million homes were empty on Census night. 

One Nation believes that part of the issues stems from foreign buyers purchasing new housing stock and locking it up, so that it can be sold as “brand new” when values rise. Much of the construction during this COVID period was removed from the market in this manner. The Greens also highlighted this issue: read here.  

One Nation’s housing policy includes measures to end foreign ownership of residential and agricultural property, aiming to help Australians secure homes. 

Another contributing factor are owners that decide tenants are too troublesome and choose to forgo rental income. This problem would likely be more common among foreign or corporate investors who view real estate as a speculative investment – focusing on fast capital appreciation rather than rental returns. 

Why wouldn’t foreign investors pour capital into Australian real estate, given how fast property prices are increasing?

 

Rising Australian real estate prices were an irresistible target for international and local capital. Additionally, superannuation firms are increasingly investing in residential property, potentially adding to the demand and contributing to rising prices.  

Is Short-stay Accommodation Contributing to the Housing Crisis? 

The short-stay rental market, such as Airbnb, is often highlighted in discussions about housing. There are approximately 100,000 short-stay properties in Australia, which adds to the 280,000 rooms available in the conventional accommodation sector. 

In comparison, Australia’s total housing stock comprises 10.8 million homes, meaning short-stay properties represent less than 1% of the overall market. 

The short-stay rental market caters to people seeking holiday or business rentals and is an industry with a finite growth curve.  Many short-stay rentals are not stand-alone units.  Often, they are converted spaces like garages or spare rooms. These types of properties would not typically qualify as permanent rental accommodation under existing planning regulations.  

Many of these properties have always been used for short-stay purposes. In the past, these properties would have been managed by local real estate agents and legacy websites like Stayz. Therefore, the actual number of rental properties removed from the market for short-stay use in the past 5 years, is much less than the 100,000 figure suggests. 

While some on the left are fixated on short-stay rentals, it appears to be more an ideological abhorrence of Australians that use entrepreneurship to get ahead. 

We Need a People’s Mortgage Scheme! 

The Housing Future Fund (HFF) is an Albanese Government initiative to create a fund that invests in mortgages. Currently valued at $10 billion, it is expected to be increased to $20 billion. However, this scheme has not delivered a single new home and is limited to just a few thousand properties per year.  

One Nation proposes to turn this scheme into a low-deposit, low-interest Government-backed mortgage scheme for Australians, especially those with a HECS debt.  This proposal would help people secure homes years sooner. 

One Nation will convert the HFF into a mortgage fund, offering government-backed loans to Australians who fail to meet traditional banking criteria. This is aimed primarily at the three million HECS debt holders in Australia.  These individuals, HECS repayments can restrict their ability to buy a home, manage a mortgage or save for a deposit, as their HECS debt impacts their income. 

We propose offering People’s Mortgages with fixed terms of up to 25 years at a 5% interest rate, with the option for early repayment, and requiring only a 5% deposit. This is in line with the Government’s own low-income deposit scheme. 

Applicants will also have the option to use up to one-third of their superannuation for the deposit, with the condition that the funds must be repaid when the home is sold. 

For Australians who have been employed for several years, have a reasonable income and superannuation balance, and qualifies for the first home buyers grant, it’s likely that no cash deposit will be required for an entry level property.  Additionally, the mortgage repayments will be comparable to current rent payments. 

People’s Mortgages for HECS Debt Holders 

One Nation will offer HECS debt holders a simple and straightforward choice: 

  1. Continue paying off your HECS debt while managing a mortgage as you do now; or 
  1. Roll your HECS debt into your mortgage, extending the repayment period over a longer period.  This option allows you to secure a mortgage sooner if your income and eligibility for a First Home-Owner’s grant, along with a superannuation top-up, support it.  While this option increases the total cost of your HECS debt over time, it enables you to purchase a home much earlier. 

Mortgages will only be issued if the applicant meets the lending criteria, including the ability to make the repayments through gainful employment or a self-owned business.  

These mortgages will be administered through an Authorised Deposit-taking Institution (ADI) or approved intermediary, such as mortgage brokers. 

Case study: Blake has the average HECS debt of $25,000 and is paying that off over the average duration of 9.5 years. The debt increases every year with indexation, Blake will most likely repay a total of $29885 at $300p/m before being eligible for a home loan. Under One Nation’s low deposit mortgage, Blake can roll the $25,000 debt into their mortgage and pay the debt off over 25 years at 5% interest for a total repayment of $43,800. This will add $146 per month to the mortgage, a much more manageable figure.

For more details on how One Nation plans to make HECS fairer, refer to our HECS Policy. 

Suspend Charging of GST to Buyers 

According to the Australian, government fees, charges and taxes account for 50% of the cost of a home in Sydney and 32% in Queensland.  Housing has become a cash cow to maintain bureaucratic empires and social agendas, making it increasingly difficult for everyday Australians to afford to build their own home. 

One Nation policy will strip away red, green and blue tape, allowing tradies to get on with the job. 

I have requested the Parliamentary Budget Office cost our proposal to suspend collection of Goods and Services Tax (GST) on new home construction. The policy is straighforward – builders will be able to claim back the GST on all building materials they used in the construction of the homes, rather than passing the GST cost onto home buyers. 

This measure will cost $1.4 billion over 5 years and will lead to a corresponding reduction in the purchase price of new homes. 

Since GST revenue is collected on behalf of the states, the Federal Government will compensate the States for the reduced GST revenue.  This practical measure provides direct assistance and rewards the completion of new, ready-to-sell homes.

Addressing Building Materials Shortages 

Amid discussions about building houses, the Prime Minister is ignoring a critical issue: the availability of building materials. 

At the same time the Prime Minister is trying to build homes, the Greens and the Prime Minister’s own Net-Zero cabal are obstructing essential industries.  These groups are targeting forestry for timber, steel production for frames and supports, and cement manufacturing.  Of note, a major ingredient in cement is fly ash, a byproduct from burning of coal for power.  Therefore, eliminating coal power will also decimate Australia’s cement industry. 

One Nation’s Strategy to Tackle the Building Materials Shortage 

  • Approve the harvesting of plantation timber for the domestic construction industry, with conditions for adequate replanting and regeneration. 
  • Building new, clean steel plants at Abbot Point and Port Hedland to capitalise on Australia’s competitive advantage in steel production. This will lower costs, improve the quality and increase the availability of steel for the construction industry. 
  • Utilise steel mills to provide fly ash for cement production and provide heat for production of ceramic tiles and other building materials. 
  • Promote the development of an Australian hemp industry to produce hemp-based particle board, building bricks and insulation. 

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