According to Dr. Matthew Thomas of Social Policy and Alicia Hall; housing affordability in Australia has broadly declined since the early 1980s. The price to income ratio index shows a tremendous 78% increase between 1980 and 2015. What can be done about it? The common argument is that there simply not enough new houses being build for those in low-income brackets. The National Shelter chief executive; Adrian Pisarski; estimated half a million extra affordable homes were needed to address demand. Unfortunately; the current market does not encourage the development of affordable housing. There are challenges and hidden barriers to development; says Professor Rachel Ong; deputy director of the Bankwest-Curtin Economics Centre at Curtin University. Since the house prices are lower; there are less monetary incentives compared to higher prices projects. “In theory; this shouldn’t be a problem because one would expect that if you have more housing supply in higher segments; then you should start seeing house prices (at the top end) drop and houses trickle down into lower priced segments”; she says. However; over the past nine years; the research did not show any evidence of this trickle-down effect; “This is where it gets really concerning.” What can be done? In terms of intervention; Commonwealth Budget recently announced measures that represent a step in the right direction. Pisarski agrees that to slow the growth in home prices tax breaks that had encouraged speculative investment – negative gearing and capital gains concessions - are necessary. “It will take more than a decade to repair the damage done by the last decade of unrestrained home price speculation. A long-term housing affordability plan led by a commonwealth housing minister and backed by the states is vital;” he says. Australia is currently building a large number of new homes because of the current boom in new residential construction. However; affordable to low and middle-income earners are still lacking housing that is affordable as well as being suitable for their needs.