An Aristotelean interpretation of Australian housing affordability

Housing has become progressively less affordable over the last half century in Australia. Attempts at making housing more affordable have been ineffective in reversing the trend. This paper argues that housing unaffordability is actually an artefact of philosophical assumptions built into contemporary economics that have become so commonly accepted as to become invisible. The metaphysics of Aristotle is representative of philosophical approaches that lead to different economic outcomes where housing would be durably affordable. Using Aristotle’s understanding of the common good, society, private property and natural price, it is argued that private profit-taking in unimproved land is improper. Likewise, excessive charges for human products, such as building improvements is immoral. Combined, this would suggest that if house pricing were based on Aristotelian principles, the building industry could still flourish as a vibrant private enterprise, but housing would remain affordable. Comparisons to other cultures suggest the implicit presence of Aristotelean principles in societies where housing is durably affordable. Overall, the paper argues that a different philosophical perspective will be needed to durably address the problem of Australian housing affordability. It resists the temptation to argue a specific policy solution since the paper’s objective is primarily methodological. Consequently, its purpose is to provide a platform for further investigation.