Government should have a program to solve housing crisis. A
best way is to invest in housing annually to grant a loan package to those who
can afford it. This loan package will not hurt the economy in general. This
loan will only solve the existing long-term problem of affordable housing
crisis. Currently people who cannot afford are not affording and contributing
to the economy. If they get affordable means, they will contribute to the
economy.
Loan conditions
The loan package is up to
$500,000 to all Australians who hold non-dual citizenship, with regular income.
They must be who cannot afford to buy the house at once. The government will
co-own that house.
An Australian who holds dual
citizenship must give up the foreign citizenship to get the loan. The owner may
take dual citizenship again after paying back the loan.
Interest will always stay at the
same rate of 2%, adjusted with inflection rate. If the loan is $200,000, it
might become $250,000 at the end of mortgage period. Then the owner will pay
$250,000, plus the interest.
Owner’s conditions
If someone can prove:
She or he cannot afford the house
without this loan,
She or he has the proven income and
it is the only means to pay back,
She or he must have the means to
pay the mortgage for 3 years minimum to get the loan.
The owner must build a new house
to get the loan.
The owner may buy the house with
government regulations, inspection, and approval.
The owner can build a new house
independently with a desired design designed by a designer and built by a
builder if it is single dwelling.
The owner may buy an apartment or
a flat with government regulations, inspection, and approval.
The size of loan is only the
actual value of the house; if the house is, for example, $200,000, then the
loan is only $200,000.
The owner may pay the whole loan
back anytime, plus total interest amount of ten years.
Government conditions
During the phase of 3-year
period, the owner must not leave, sell, or rent the house to anyone.
After the 3-year period, the
owner may move and sell, but not rent the house.
Mortgage rate is to be not less
than 5% of the loan P/A. The owner may choose the desired amount any time she
or he wants to pay.
Leaving and selling the house
After 3-year period, owner may
move or sell the house.
The owner may make profit.
The owner must pay a whole amount
of loan, with applied conditions as stated above, or may keep paying the
mortgage after moving or selling.
The owner may move to another
house co-owned by the government.
Two owners may swap their houses
and mortgages.
Investors and fund
The government can allow the investors who agree above
permanent rules of the program. Banks, foreign investors, Australian investors
and individual investors may invest as much as they want. No fixed return – it
depends on the number of borrowers and the amount of loans they borrowed – the
investors will share the profit annually. The government is always the main
investor. The government must prioritise the investors that government will
replace its investment money with investors’ shares. If there are no investors,
the government will be the lone investor.
Benefit of this program
Businesses in no pressure will serve the people better.
Long-term investment with regular return can profitable.
The program will stabilize the economy by stabilizing the housing
shortage.
The program will take the pressure away from public housing
sector of the government.
The program will benefit the public in the following ways:
The retiring workforce will have home.
New generation will have own home.
The cost of living and commodity will fall while the
standard of living rises.
The invested money will remain the same to benefit
generation after generation.
The government will have to add some funding in regular
basic to cope with growing population; however, existing houses left by the
elderly people will reduce the pressure. However, such funding will be smaller
than the fund needed for the current housing spending.
Politics
Political leaders might find it is hard to implement a
solution for political reasons. They may have to choose between actual solution
and political ideology, such as - capitalism, market economy, etc. with the
need to avoid sounding like their own opponents. When the opposition gets the
office, they might find the solution being in conflict with other agendas.
Instead of pragmatic approach to problems, political leaders can have a hard
time making agreement within a party. The people who elected them can be the
last problems in their mind who they should attend when another election is
approaching.
