Latest news with #BenPhillips
The Australian
3 days ago
- Business
- The Australian
Explorers Podcast: Norfolk Metals
Stockhead's 'Garimpeiro' columnist Barry FitzGerald is back in the studio for another instalment of The Explorers Podcast. In this edition, Barry chats with Ben Phillips, executive chairman of Norfolk Metals (ASX:NFL), as the company prepares to drill its Carmen copper project in Chile's Atacama region. Having met all conditions of its earn-in agreement, Norfolk will now move to Stage 1, aiming to earn a 70% stake in Transcendentia by spending $3 million over three years. With permitting underway and a 5,100m drill program planned for Q3, the company is targeting a shallow copper oxide resource with potential for a low-cost, high-margin heap leach operation. Listen to hear the latest. This podcast was developed in collaboration with Norfolk Metals, a Stockhead advertiser at the time of publishing. The interviews and discussions in this podcast are opinions only and not financial or investment advice. Listeners should obtain independent advice based on their own circumstances before making any financial decisions.
The Guardian
5 days ago
- Business
- The Guardian
Fewer than 1% of households with multimillions in super could struggle to pay Labor's tax, study finds
Fewer than 1% of households with multimillion-dollar super balances could struggle to pay for Labor's additional tax on retirement balances above $3m. New ANU research also reveals that households liable for the extra earnings levy have 12 times the wealth of other households, including an average of $3.2m outside super and the family home. They also have more than two-and-a-half times the disposable income. Ben Phillips, an associate professor from the ANU's Centre for Social Policy Research, said the analysis undermined claims that many individuals would struggle to find the cash to pay for the proposed 15% earnings tax on balances over $3m, which is applied to notional gains rather than realised profits. Phillips said he had done the research to inform what he called the 'unprecedented' public debate of a relatively minor policy change that affected a very small proportion of wealthy Australians. 'These are very wealthy people with a lot of other assets, and also with a lot of income. It would be very, very surprising if all but a small handful of people would struggle to pay this tax,' he said. In particular, Phillips and his colleague Richard Webster, a senior research officer, wanted to test claims that taxing unrealised gains could force some to sell big assets – most notably farms – to pay the impost. With the farming lobby group mounting a campaign against the super tax, the research estimated about 2,400 people with large super balances are farmers. The farming lobby has claimed that cash-strapped but asset-rich farmers could be forced to sell farm land to raise money to pay the tax, which is calculated on the annual notional change in the value of their super balances. The modelling of ABS survey data showed that only 0.6% of the estimated 87,000 individuals with large balances, or 500 people, could struggle to find the cash to pay for the extra earnings tax. 'They are sort of 'unicorn' cases, and even then we don't know what's in their super accounts,' Phillips said, which he reckoned were likely to include enough liquid assets to pay the tax. 'That's not to say it's necessarily a good tax, but we are not seeing any barriers to these people paying a bit of extra tax on their super.' Sign up for Guardian Australia's breaking news email The paper models a scenario where an individual with $4m in super records a 10% gain, which – assuming for simplicity no contributions or withdrawals – incurs an extra tax of about $19,000. If that extra tax is more than 10% of the household's disposable income and other wealth (that is, wealth not in super or in the home), then that household fails the stress test. In this case, the household could struggle to pay the tax if they are also unable to easily pay the tax from their super savings. The modelling suggests the median high super balance household has annual disposable income of nearly $250,000, versus $95,000 for all households, and nearly eight in 10 own their own home outright. Two-thirds of the estimated 87,000 people with high super balances are men, three in four live in a capital city, and over half don't work. 'We really need to question why people have so much money in super for a start, when you only need enough to give you a comfortable retirement,' Phillips said. 'You also have to question – given the nature of super, where it's about getting money when you need it – why would you have large amounts of illiquid assets [assets not easily converted to cash]? That's not really what super is about. That seems to be more about a tax haven, rather than a saving vehicle for your retirement'
The Guardian
11-05-2025
- Business
- The Guardian
Australia's rental crisis is not what you think it is
Footage of long queues at the doors of properties for lease has become a regular feature of property reporting over the past few years. Landlords have upped their asking rents by double digits. Ahead of last weekend's election, the Greens campaigned hard for rent freezes to stop the 'unlimited rent increases' they claimed the major parties tacitly supported. There have been horror stories of single parents struggling to find an affordable home, while a lack of housing plagues residents in disaster-stricken towns such as Lismore. Yet the rental crisis is not what you think it is. That's because for the vast majority of renting households, it's not a crisis at all. Ben Phillips, an associate professor at the Australian National University Centre for Social Research and Methods, says talk of a national rental crisis is 'overblown'. Phillips says much of the media attention has been focused on the rapid rise in advertised rents, which peaked at well over 15% in 2024, according to property research firm CoreLogic. That's the fastest annual rate on record, according to this data stretching back about two decades. And since the end of 2019, this measure of rents has climbed by nearly 50%. But Phillips, a member of the Albanese government's economic inclusion advisory committee, which has advocated for a major lift in the jobseeker payment, says these online advertised rents are only a small and unrepresentative share of the total rental market. They reflect how difficult and pricey it is to move rentals, or rent for the first time. What they don't reflect is how much most of the roughly 3 million households with a lease are actually paying. And there, the picture is very different. The most comprehensive database on rents paid is produced by the Australian Bureau of Statistics as part of its consumer price index (or CPI, which measures inflation) series. The ABS each month tracks rental rates for about 600,000 properties, or nearly one in three leased homes. And by this measure, rents have climbed by 19% in just over five years - or less than half the CoreLogic reported rate. That's not nothing, but it is two percentage points less than the overall increase in the CPI over that same period. In other words, rents have been a drag on overall inflation. Michael Fotheringham, the managing director of the Australian Housing and Urban Research Institute, says Phillips' analysis is right. The Corelogic rental data 'show a more inflamed market than ABS data, and that's because a significant proportion of renters are in a stable situation', Fotheringham says. 'They have been in that property for more than a year, and have a landlord who is not looking to jack up rents whenever they can,' he says. On the other hand, there are also renters who are struggling to find a property at a time when the national vacancy rate is at a record low of 1% – as it has been for the past two years – against a more typical rate of 2.5%. 'They are both correct [the two sets of data] but they are talking about different things.' That said, Fotheringham says, there is a 'fundamental problem with the word 'crisis''. The problems in the housing market have not appeared suddenly, like a natural disaster, he says, and an emergency response is not the way to fix the problems that ail the housing market. 'We have a badly broken housing system that we have been sleepwalking into for 40 years. We need long, slow, multifaceted programs. It's taken decades to get us into this mess, and it won't be fixed by Christmas.' Phillips, in the unreleased research paper Australian Rental Cost Trends, says the confusion over how much rental prices have increased boils down to the difference between the 'stock' of properties versus the 'flow' of properties. 'Economists often make this distinction using a bath tub analogy,' he writes. 'A small flow of hot water (new rent data) makes little difference to a much colder and larger stock of water in the bath (all rents in the market).' Averages can hide a multitude of sins, but Phillips says the Albanese government's boosts to rental assistance and parenting payments have helped cushion the impact of higher rents on lower income households. 'There are people who are struggling, but the talk of a generalised rental crisis is overblown,' he says. Phillips' analysis shows that rental affordability has actually improved over the past decade, with renters' incomes rising faster than rents. Despite a recent uptick, he estimates that rental costs as a share of renters' incomes have dropped 'fairly substantially' from 28% in 2013 to 26% now. Similarly, a little over one in five renting adults in 2023 reported at least three forms of financial stress – a threshold for severe pressure, according to the latest Hilda survey. That's a lot, but it's not much changed from the recent low of one in six in 2021, and it's about the same as the 15-year average.
The Guardian
20-04-2025
- Business
- The Guardian
Who actually benefits from the Coalition and Labor's housing policies?
The major parties have pledged to give Australian renters a hand to enter the housing market, but experts warn their flagship policies will only help a narrow group of people. So who will benefit from homebuyer help – and will more people be helped into the market? Here's what you need to know. Sign up for the Afternoon Update: Election 2025 email newsletter Most of Australia's 8 million renters will not benefit from first home buyer assistance proposals, according to analysis seen by Guardian Australia. That's because only a small proportion of renters enter the housing market each year – and they generally have the highest incomes, according to researcher Ben Phillips, who is an associate professor at the Australian National University's Centre for Social Policy Research. 'It's probably going to be benefiting people who are going to become homeowners anyway,' Phillips says. Excluding pandemic lockdowns and the global financial crisis, about 100,000 households enter the housing market annually, according to home loan data from the last two decades. Nearly half of all renters sit in the bottom 40% of income levels, compared with just one-fifth of first home buyers. 'If you're in the bottom two quintiles of income, you're probably not really going to have enough income to be servicing a mortgage, whichever way you go,' Phillips says. 'There's not a lot that we've seen in the election campaign to really help those people, and they're the people who really are struggling.' That leaves nearly half the renting population, or 4 million Australians, beyond the reach of homebuyer help even before the new policies arrive. This scheme could benefit as many as 60,000 first-time buyers but will put more cash in higher earners' pockets and may not bring additional people into the housing market, experts say. The Coalition would let first home buyers deduct a portion of their repayments from their taxable income if they buy a newly built home, benefiting nearly 30,000 households annually on average – though the Housing Industry Association estimates it could be double that. The HIA expects the scheme would see the existing pool of first-time buyers swing towards buying new builds. At present, first-time buyers tend not to buy new builds, preferring existing homes, but those that do are likely to be on higher incomes. Top earners would particularly benefit from this policy as they pay higher rates of tax and therefore would get more money back from deductions. They may even get the bulk of the benefits unless banks treat the deduction as a genuine increase in income and let lower earners borrow more, according to Matt Bowes, housing expert at the Grattan Institute. 'It may not increase people's borrowing capacity, it may just be giving them a free kick in that initial period of the loan,' he says. Bowes says it's not clear whether the policy would lift more people would into the market. This proposal could help up to 30,000 people enter the housing market every year, the government estimates, though a lack of income caps may see the benefits go to those who would have the means to enter already. The expanded first home guarantee is open to all first-time buyers but is expected to be accessed by a 'pretty narrow band of new first home buyers', Labor's housing minister, Clare O'Neil, has said. By covering mortgage insurance and reducing upfront payments to a 5% deposit, the policy would let buyers get home loans sooner, permanently bringing forward the number of people who can buy, according to Peter Tulip, chief economist at the Centre for Independent Studies. 'It's a big subsidy, so that would mean you would get an ongoing increase in the flow into home ownership,' he says. But high earners would gain access to the expanded scheme if the government removed income caps, Bowes warns. The Coalition is proposing a smaller expansion that retains some income caps. About 160,000 extra people could enter the housing market in the first year of this policy's operation, but Tulip estimates the boost would only be temporary. First home buyers trying to secure a deposit would be allowed to put in 40% or no more than $50,000 of their own superannuation under the Coalition's proposal. That would more than double the number of first home buyers temporarily, before it returned to current levels, according to Tulip's research on a similar scheme. The Coalition's housing spokesperson, Michael Sukkar, says the policy 'will accelerate' homebuyers' decisions. Wealthy people and higher earners would see less benefit from super for housing as they may be better off leaving their retirement savings untouched, Tulip says. 'They can already save a deposit or get help from their parents, so they don't actually need help from the government,' he says. This policy would make it permanently easier for some first-time buyers to make both the deposit and the repayment on their homes but will take in just 10,000 people each year for four years. The plan, set to open later in 2025, was originally only for individuals on capped income and loan sizes, but Labor raised those caps in March's budget. Joint applicants and single parents earning $160,000 would be permitted to co-purchase homes alongside the government as costly as $1.3m in New South Wales. The scheme would permanently increase the number of first home buyers year-on-year and could help renters whose incomes would otherwise be too low to enter the market, though increased caps could end up helping middle-income earners more, according to Grattan expert Bowes. 'With a scheme that has a limited number of places, you increase the risk that it becomes a lottery, and those low-income people who would most benefit are the ones who miss out,' he says. Relaxed lending standards by lowering the serviceability buffer could temporarily help borrowers' earnings go further and help them enter the market. The opposition leader, Peter Dutton, has said a cut to the buffer would enable 'tens of thousands more Australians' to get a home loan. Economists agree more people could buy if regulators lowered that rate, which banks add to their lending interest rates when assessing a borrower's ability to repay loans. 'It allows people to borrow more and if you can borrow more, then maybe you can out-compete other people in the home market,' Bowes says. But like all of the buyer help policies on offer, looser lending rules would see growing numbers of people bidding ever greater amounts of money on a slow-growing supply of housing, worsening affordability, he says. 'Given high house prices, how useful is that to a broad range of people who are locked out of home ownership?'
