FET #82: Matt Lloyd-Cape explains what’s wrong with housing in Australia and how history shows us how to fix it

My friend Matt Lloyd-Cape just released his book, Our Place*,* about the story of housing in Australia. Our views on housing differ somewhat, which made for a more interesting chat. Though we both arrive at similar conclusions about the need for government and non-market housing if we want to make large changes to housing outcomes, we disagree about the extent and effectiveness of interventions in the markets. For example, Matt favours financial subsidies in the form of publicly provided discounted mortgages, which can give households who qualify a leg. I see that as just another cash subsidy (which rises in value with the value of the home you buy) which is hidden by being amortised in the form of a cheaper mortgage. We already have cash subsidies in Australia for first home buyers in the form of cash grants and discounted stamp duty (which has the same net effect). Do we need or want more? I don’t know. You can read an extract of the book here, and buy the book at Amazon here. Matt will be speaking at two upcoming events in Melbourne (21st Oct) and Adelaide (5th Nov), so if you are interested and want to catch him speak and chat about housing, I recommend getting to one of those events. Put Fresh Economic Thinking to Work Why a paid subscription matters A paid subscriber to FET wants intellectual challenge. They don’t want someone to write what they already think. They want insights that are hard to get elsewhere and a public debate that is intellectually honest, not tribal. Subscribing is a vote for independence — you're saying *I want Cameron Murray to have the financial freedom to investigate things that other economists won’t.* If that sounds like you, and you get value from the research and analysis published here, I’d appreciate your financial support. A fresh economic consultancy Most economic consultancies begin with the conclusion a client wants. They sell institutional credibility and a report. I sell economic thinking. If your organisation has a difficult economic question, a policy argument that needs testing, or a problem where you want to get beyond the usual consultant consensus, I’d like to hear from you. FET also provides custom economics training, presentations and workshops for organisations that want their people to understand the economics behind the issues they work on. If there are economic concepts, debates, or blind spots your team needs a genuine handle on, then please reach out. Ground Rules: Land and Housing Economics for Professionals Put that professional development budget to work with an upcoming FET Land and Housing Economics workshop in Melbourne on 10-11th November. This two-day workshop is crafted for smart researchers, policy analysts, economists and planners who want to truly understand how land and housing markets work. This course may be eligible for CPD points from your professional Institute. Please check directly with them. Tickets here More details here. *As always, please like, share, comment, and subscribe. Thanks for your support. You can find Fresh Economic Thinking on* YouTube*,* Spotify*, and* Apple Podcasts. This is a public episode. If you'd like to discuss this with other subscribers or get access to bonus episodes, visit www.fresheconomicthinking.com/subscribe