I would certainly agree with this article, In addition, costs are driven up by fees and charges by local and state government on every transaction. Certificates which involve nothing more than printing out an address query from a database are charged over $100, Regulations demand that experts are consulted and paid for pro forma statements, that are the work of clerical assistants.
While each of these transactions is minor, the overall effect on one's wallet is like throwing away a $100 bill at each set of traffic lights.
If the end result was high standard buildings with no pronlems then it may be argued that this was justified.
In reality, people spend more time trying to get around, complying with, and being annoyed by regulations and fees, they have no option but to build inferior housing that is "complying".

This is THE fact,
"However, this recommendation was made subject to the important proviso that supply-side constraints in the housing market need to be tackled first..."

Govt needs to get back to putting in the services like they used to...and/or stop bringing in all these people we don't need.

..there is plenty of good housing land in NSW/Oz but Govts force people with a few acres to subdivide to put in Sewerage plants, services, parks...&...?. Every legal restriction too etc...

We ought consider letting people build whatever they reasonably like in industrial zones and perhaps also in commercial zones is good.

Lastly, why does this article not refer to how few Australians now own their own home compared to the past?....

If we REALLY want Oz to go well we need to get more young people "a job & a mortgage" which for too many almost impossible nowadays.

My son did some holiday work mixing mud for plasterers and these ‘trades’ were earning $800 a day and their ‘trade’ took 8 weeks to learn. Eligibility to join the ‘trade’ was to survive being a mud mixer for about a year.

Conversely, I believe if you get yourself a PhD in science and do field work and have twenty years experience you might, if you are lucky, get to five figures.

About half of a house’s cost is in the labour.

I would suggest a mechanism that brings self employed 'trade' earnings down to about $90K a year would do much more than a tax measure.

On top of that is quality or lack thereof of their handywork. The ‘trades’ my son worked for would take brickies sand when they ran out of plasterers sand. Plaster from brickies sand will eventually fall of the wall because of it high clay content. I explained to my son who explained it to the ‘trade’. He was told he was living in fairy land – the sand is yellow, that’s what counts.

As is often the case, I do not understand economics or the thinking of economists.

I wouldn't be to so sure in your conclusions. I'm in New Zealand where there is NO, and never has been, any capital gains tax. Housing is now the safest, easiest way of making large sums of money. Guess what this causes - that's right, an undersupply and heightened demand for housing - the exact problem you have in Australia. Obviously capital gains tax alone can't reconcile these two situations.

In NZ, the tax-free gains on housing is one of the greatest contributors to increasing socio-economic disparities - those that can afford housing buy into it and make large sums in profit, home ownership rates at the lowest point ever in NZ history (so we are seeing that those that can afford property are increasing the number of properties they own), and there is now a large part of NZ society that will never be able to afford to own their own home. Is this what you want for Australia?

What rubbish!

Negative Gearing and other tax advantages for property have done almost nothing to increase supply. The statistics show that far less than 10% of negatively geared properties are new dwellings. The remaining 90% just compete with owner occupiers, driving up prices without adding anything to supply.

If you seriously believe that tax incentives will lead to increased supply then limit those incentives to new dwellings.

"A fundamental truism of economics is that if you tax something, you get less of it," says Kirchner. That's true of things produced by the taxpayer. But it isn't true of things produced by nature, because the laws of physics have no respect for the taxman. Neither is it true of things produced by taxpayers other than the one who pays the tax, because only the latter responds to the disincentive.

So you tax the value of land -- through land tax, or council rates on site values -- you don't get less land or less valuable land, because land is a gift of nature, and its value is created by the activity of the community surrounding the land, not by the owner who pays the tax on each particular piece of land. What you do get is improved availability of land for productive purposes -- such as housing -- because the owner of each piece of land must generate income from it in order to pay the tax, or sell it to someone who will.

Yet Kirchner treats land tax as if it were a tax on housing. And he treats capital gains tax as a tax on housing, notwithstanding that what gains in value is the land, not the house. #Fail.

And he implies that negative gearing is essential to housing supply, when in fact you don't have to supply any extra housing to qualify for negative gearing. All you have to do is buy an existing house -- taking it from a prospective owner-occupant! -- and pretend that it's available for rent. #Fail.

"The principal residence exemption from capital gains tax is in fact model tax policy based on an expenditure tax benchmark," says Kirchner. It would be equally consistent with an expenditure tax benchmark to let people buy houses out of pre-tax income and pay tax on the resale. And if Kirchner's complaint is that capital gains tax on an asset bought with after-tax income is double taxation, then the abolition of capital gains tax is not the only solution; the other is to get rid of tax on earned income!

The world has been plunged into a debt crisis by the bursting of a global land-price bubble. Land tax was one of the few things restraining growth of the bubble -- or would have been, if the rates and thresholds had not been adjusted to "compensate" property owners who were "suffering" because their assets were rising in value! Yet Kirchner apparently wants to get rid of land tax altogether, thus condemning the world to even more violent boom-bust cycles in future. #Fail.

I do know a few people who have 20+ investment properties who complain about paying tax. I don't have any issue with people who have lot's of investment properties, but I do have a problem with them buying up cheaper properties.

I'd like to see less tax on the first few properties, and much more tax on 4 or more properties. In theory, this will encourage investors who can afford more, to invest in less, higher-value properties, leaving the cheaper investments to the people who are starting out.

Think it's worth pointing out that the CIE report referred to in this article includes a whole range of what they call 'hidden taxes' in their calculations, including infrastructure charges, planning delays and zoning requirements. These account for about 40% or $106k of what they're calling the housing 'tax burden' in Sydney.

It's fine to have a debate about planning delays and infrastructure charges, but it's a bit disingenuous to call it all 'tax'.

This article states that 'Australia's housing market is chronically undersupplied'. Says who.I don't see people living on the streets... I would agree its unaffordable, which is about the only thing I agree with in this article. There's certainly something wrong with the skewed investment system in this country when I rent a ~ $900,000 home for $520 pw from which I imagine the owner gets maybe $400/week after expenses whereas taking that same $900,000 and putting it in the bank would yield over a $1000 a week in interest (at 6%). I just wish I could ask my bank not to use my savings to make home loans and thus continue to support this housing market Ponzi scheme.