Property Australia

Make Housing Priority

Ken Morrison Ken Morrison November 18, 2021

Originally published in The Daily Telegraph, 19 November 2021.

Property prices. New homes. There is no bigger barbecue conversation. So it's no wonder it's also been the subject of 11 separate federal parliamentary inquiries and reports since 2003. And this week marked the end of hearings of yet another. The examination into housing affordability and supply, led by Liberal backbencher Jason Falinski, wrapped up taking evidence on Wednesday.

The challenge for this committee is to do more than just produce a report that makes headlines for a day but then gathers dust for decades. Moreover, given it's a federal inquiry, it should carve out a strong role for the federal Government - not just its state and local counterparts - in tackling the drivers of affordability. As the Reserve Bank noted in its evidence, record low interest rates have fuelled house price increases around the world, as it has become cheaper for people to borrow. The RBA also flagged that housing supply was slow-moving compared to changes in demand for housing.

All the more important to have long-term supply pipelines built into our city planning and the RBA argued the benefits of 'speeding up planning systems to reduce general inefficiencies, improving transport infrastructure and lowering the cost of new construction'.

Even with no new international arrivals and despite the success of HomeBuilder in stimulating new housing construction, the supply pipeline remains a concern.

The planning system has been unable to support the delivery of the housing needed for the future.

The NSW Planning Department's own data starkly reveals that only one local council in Sydney will actually meet its set five and 10-year targets for new homes (the Hills District). Every single other council has failed, despite state government pressure.

All this without any new overseas arrivals for the past two years. When we reopen our borders to normal levels of migration, and another 230,000 people arrive on our doorstep ... well there actually won't be a doorstep. So what should be done about this and - more particularly - what can and should a federal Government contribute to the solution?

Fixing housing supply is the responsibility of state and local governments, and it's inherently difficult. Adding density in existing suburbs or building new ones will naturally face challenges and objection.

These challenges make good - and timely - planning an imperative. There is an important opportunity for the federal Government to look beyond the job-saving recovery stimulus of HomeBuilder, to provide the leadership and support to state and local governments that is needed to unlock housing supply and put some downward pressure on prices.