Landlords dominate Australia’s parliament and Reserve Bank. Their policies make the housing crisis worse.
In Australia, the war in Iran is having a dramatic effect on prices. Fuel costs are already up and are set to further soar anywhere from 10 to 20 percent. Australia’s dependence on fertilizer imports, combined with price gouging, is driving up food production costs and supermarket shelf prices.
This cost-of-living surge comes in the context of a worsening housing crisis. House prices in Australia rose 8.6 percent in 2025 and are predicted to rise at least 5 percent this year. Mainstream economists now describe Australia as “a homeowners’ welfare state.” Government policies incentivize landlords to claim losses on rental properties to reduce their income tax, then recoup those losses by selling the property at a reduced tax rate. The top 10 percent of earners in the country claim $4 out of every $5 under these schemes, which have boosted debt-fueled property speculation.
In response to inflationary pressures, the Reserve Bank of Australia (RBA) has already lifted interest rates to reduce demand. It was the thirteenth rate rise since mid-2022. On the same day, RBA Governor Michele Bullock bought a multimillion-dollar luxury coastal home — her third investment property. This decision sparked outrage. Around half of young Australians already blame the RBA for the housing crisis.
Housing activist Jordan van den Lamb shot to viral fame as an anti-landlord influencer two years ago. Just last month, millions of Australians watched him issue a warning on national television, that profiteers should not be surprised if the victims of price gouging and the housing crisis turn on them.
Unsurprisingly, Australia’s political establishment and its parliament of landlords despises van den Lamb. He regularly outrages conservative radio hosts and has even earned the ire of Labor Prime Minister Anthony Albanese, who owns multiple investment properties, and who publicly branded van den Lamb “a disgrace.”
Jacobin spoke with van den Lamb about the RBA, the housing crisis, and why the far right has no answers to the crisis.
How is inflation part of the economic class struggle around who gets what?
The Reserve Bank of Australia is one of the key institutions of the ruling class. But inflation has been depoliticized. Measures to control it are framed in the media as neutral tools. But they’re clearly political.
In the past, periods of high inflation have involved businesses raising prices to widen profit margins and workers fighting for higher pay to safeguard their standard of living. But the gutting of the labor movement means the active conflict between profits and wages that we saw in the past is just objectively not happening. There aren’t two sides upping the ante at the moment. Inflation is massively profit-driven, but wages don’t keep up with those profits in any way.
The RBA talks exclusively about keeping inflation in its target range by raising the cash rate. This sounds very technical. But the cash rate is just a tool used by the RBA to control how much profit companies can make in the face of various crises, at the expense of the working class.
Minor adjustments to the cash rate mean increasing bank profits at the expense of working-class people with mortgages. More major adjustments mean throwing hundreds of thousands of people into unemployment.
Why would big business want more people unemployed?
In our economic system, workers need to buy things like food and housing in order to survive. This means finding a job, which means competing with each other to get one. By increasing the amount of people that are unemployed, bosses can be pickier about who they choose to employ. The competition gets tougher. Bosses can also then pay employees less because there are more people to choose from.
This reserve army of labor — the unemployed — is one of the measures that the ruling class uses to control inflation. It’s a threat that works in tandem with the housing crisis. You can see on the street a picture of what might happen to you if you end up homeless. So if you’ve got a mortgage, you’re going to forego more to keep your job and avoid that outcome. Sometimes this reserve army can get bigger, or sometimes it can almost disappear, depending on the needs of the moment. But whatever the context, it functions as a weapon to discipline workers. That’s the silent bit Michele Bullock will never say out loud.
Of course, it’s not a low unemployment rate that’s inflationary at the moment. The war in Iran is what is driving up prices. So it’s arbitrary and ridiculous to pretend that throwing more people out of their jobs and onto the street is going to bring the price of petrol down. The RBA governor herself has acknowledged that raising the cash rate is not going to stop the war. They can’t even really blame supply-side issues. In Australia, we’ve had massive reserves of fuel released recently; we’ve never had more fuel supply here than in late March. But at the same time, petrol prices have never been higher.
Aside from throwing people out of work, what other measures is the political establishment proposing?
Some big business mouthpieces like the Australian Financial Review (AFR) claim government spending and poor labor productivity are driving inflation. That’s not what’s happening. Wages have not kept up with increases to productivity since the early ’90s in Australia. This means workers have been working harder and getting paid less for at least twenty-five years. The AFR is proposing we should just keep doing that to fix inflation. That’s not a great argument.
Even the Reserve Bank governor has admitted at times that price gouging, a lack of private investment by business, and this war in Iran we’ve attached ourselves to are at fault. And Michele Bullock is the head of a fundamental pillar of Australian capitalism: her job is to make sure that businesses profit at the expense of workers. If even she’s saying this, then you don’t need to be an economist to get what’s going on.
Unfortunately the trade union leaders are not really challenging what big business has to say about any of this. We have [Australian Labor Party]–affiliated unions like the SDA [Shop Distributive and Allied Employees’ Association] working hard to protect the profits of the worst land bankers and price-gougers. And the Australian Council of Trade Unions is less progressive on getting rid of the capital gains tax discount than the CEO of the Commonwealth Bank is. This is the world that we live in right now.
How has the RBA played a negative role in the housing crisis?
In the past, the RBA increased confidence by promising not to lift interest rates. Working people borrowed more than was comfortable, and property prices skyrocketed. At the same time, the Australian Prudential Regulation Authority (APRA) mandated that banks assess whether borrowers can afford their mortgage repayments at an interest rate 3 percentage points higher than their actual rate. This helped banks build in a buffer of 3 percent. But from 2022, the RBA did lift rates, and the cash rate has since gone up more than the legislated buffer.
Political commentator Kos Samaras correctly noted recently that the RBA’s rate rises exposed the promise of homeownership as a debt trap for working people. But, in a way, he removes the villains from this drama.
It is a dire picture for the average household. But not everyone is struggling. Some people are doing really well from this absolute disaster. While working people are on a knife’s edge, sacrificing more and more to avoid foreclosure on their homes, the banks are making record profits year after year.
Landlords are also doing well. Michele Bullock bought a $1.4 million house on the same day she raised interest rates. She got a half-price, taxpayer-subsidized loan from her own institution, which pays her over $700,000 a year. Bullock owns four properties, lives in one of them and profits from the other three. It’s in her personal interest for things to get more expensive for people that don’t own property, and for those who do own property to keep making more money.
A common retort is that cash rate rises also affect over-leveraged property investors. But that’s just not accurate. These professional landlords will never end up paying for these interest-rate rises. They can negatively gear them away or raise the rent to cover any shortfall. Or they can get interest-only loans, never actually pay any of the principal off, and then in seven years sell and make a million dollars in profit (of which half is tax-free).
One Nation wants to ban foreign ownership of residential property and cap net migration to bring down house prices and inflation. Why won’t that work?
Because working-class migrants who move to another country to seek a better life don’t determine house prices: the ruling class does.
Migration is actually lower now than in the five years leading up to COVID, and foreign purchases of residential property in Australia account for less than 1 percent of sales. Any caps or bans would have a negligible impact on house prices or availability.
Foreign ownership is actually the one area where property investors are taxed somewhat effectively. Foreign owners have to make these detailed declarations about how their properties were used, and they get charged a vacancy fee if their property isn’t occupied as a residence or available to rent for at least 183 days in a twelve-month period. That’s a good start. All landlords should have to do that.
Center-right voters might be shifting to the far right, but let’s be honest: nobody thinks One Nation will solve inflation. They’re the ones supporting the war in Iran the most. In a funny way, though, One Nation’s proposal basically acknowledges that investment in property when you don’t live in it is the cause of our problems. Of course they add: “Only if it involves foreigners.” But why stop there? Ban investment in residential property for everyone and de-commodify housing — that would actually solve the problem.
So how can we deal with soaring house prices?
We don’t have a supply issue, we have a distribution issue. Over the last twenty years, Australia has had more dwellings completed than it’s had households formed. There are more than enough homes in this country. They’re just either empty, Airbnbs, or prohibitively expensive. It’s pretty simple: we’ve got more empty homes than we have people experiencing homelessness. We could expropriate those homes without compensation and distribute them.
But for argument’s sake, let’s say there were more households formed than dwellings completed. Socialists would still oppose banning migration for the simple reason that we have the ability to build homes in this country.
We could expand public housing on a massive scale. One of the policies Victorian Socialists is putting forward is to build 150,000 new public-housing units in Victoria over the next ten years. Currently, Australian state governments are doing the exact opposite: demolishing public housing, privatizing it, and calling it community housing so that institutions like the church can just lap up more and more property.
We could quite easily stop giving unlimited subsidies to landlords, then prohibitively and punitively tax the people that are responsible for this housing crisis. Our entire economy is propped up on housing. Ultimately, we need to de-commodify it.