Australia’s economy might be ticking over well, but right now we’ve got other issues to worry about. Issues like a housing crisis, for which local councils and NIMBYs are to blame.

NIMBYs? These are ‘not in my backyard residents’ who oppose developments in their neighbourhoods. They often want problems like housing shortages fixed, just as long as the fix doesn’t happen in their postcode. We’ve seen this recently with the rejection of the massive housing development on the Rosehill racecourse in Sydney.

So many of our great social problems can be linked to politicians not having the guts that leaders need to make effective changes. In the case of housing, this leads to younger generations being left as renters, over-borrowed debtors or living a long way from centres of employment.

Given the challenges of the Trump tariffs that has RBA chief economist Sarah Hunter telling an audience yesterday that the escalation in the trade war or a deterioration in the global economy could spark a fresh sell-off in financial markets, that would then put pressure on the RBA to cut interest rates.

Hunter’s remarks come as we get to see the latest economic growth figures for the March quarter. She says the potential of a trade war could lead to consumers pulling back on spending and businesses shelving investment plans.

The big take away message from the RBA’s head honcho economist is that bigger-than-expected Trump tariffs could lead to an economic slowdown and the RBA could cut rates by more than expected. Right now, the money market is expecting the cash rate at 3.85% to be 3.1% by year’s end and this would be to prevent unemployment going sky high.

However, this could lead to a resurgence in demand for houses, which would keep powering house prices higher, which would add to the woes for those who are victims of our housing crisis, which the OECD says is a supply problem, created by gutless politicians! (My words, not those of the think tank.)

The SMH’s Shane Wright looked at the OECD report, which outlined why we have a housing crisis, and named government red tape regulations for driving up housing costs and killing the productivity of the businesses in the sector. “A range of policy actions, including easing zoning restrictions, is needed to strengthen competition and productivity, as well as to raise housing investment to reverse the long-standing decline in housing affordability,” it argued.

It further argued that “reducing complexity and introducing greater flexibility in zoning systems, including by being less prescriptive about the specific activities that can be undertaken on a parcel of land, can enable firm entry and growth, as well as the ability of the economy to adapt to ongoing structural change.”

This eco-speak for governments, such as local councils and state governments, is making it impossible for businesses to make sufficient profit to want to take chances, so they play a safe game, which leads to reduced supply and higher prices.

Throw all these reasons for a low supply of new homes being built into an economy where Trump tariffs could lead to much lower interest rates from a concerned RBA, then we’d have rising demand meeting low supply, which would send house prices through the roof.

The only thing that could stop that happening would be a Trump-created recession that would send the jobless rate up big time. Then we’d see house prices fall but still have a housing crisis, and an unemployment crisis as well.

The bottom line? Politicians have to start preferring Australians, who want to buy a home, over NIMBYs.