Stopping Australia Becoming A Nation
of Renters
One
of Australia's leading property policy experts has called for a new approach
by the Federal Government to deal with the national housing affordability
crisis to stop Australia becoming a nation of renters and boost the economy by
offering new home buyers free blocks of land for ten years.
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MacroPlan
Dimasi |
The National Land
Partnership Program is estimated to reduce first home buyer entry prices by at
least 50% and cut the total cost of the dwelling over an average 25 year mortgage
period by around 20%.
Brian Haratsis,
Chairman of economics and strategic planning company MacroPlan Dimasi, gave a
key note address at the Urban Development Institute of Australia National
Congress in Melbourne this morning said, "Affordable housing should be the
Australian Government's number one policy target to create jobs".
It is estimated
the initial National Land Partnership Program project could increase new dwelling
starts by around 5,000 dwellings per annum creating 18900 FTE jobs and approximately
$1.35 billion in construction expenditure (based on an average construction cost
of $270,000 per new detached dwelling, including civil costs).
The call comes
just days after the Federal Governments independent adviser the National Housing
Supply Council warned poor planning, high costs and red tape mainly in the development
approval arena could see Australia become a nation of renters because of the lack
of housing affordability.
"Australia
now has the highest housing prices in the world because of government inaction,
chaotic town planning regulations and kilometres of red and green tape which has
killed the Australian Dream for an increasing number of Australians"
MacroPlan Dimasi
research identified the root cause of the problem as land prices.Over 90% of the
real increase in new housing prices is due to increases in land prices.
"In 2010 first
home buyers and people building a new home were carrying the major burden of infrastructure
costs. Up front figures by Charter Keck Cramer show in 2011, taxes and charges
across the three levels of Government on an average block of land in Victoria
costing $199,000, was $46,200. The largest part of the Tax $23,500 is taken by
the Federal Government, $16,800 State charges and levies and $5,900 by local councils."
Mr Haratsis said
"The key to the program
is free land for 10 years for first homebuyers. After 10 years, home owners
would be given the choice of buying the land (at the original price, having by
that point broken the back of their housing construction mortgage), selling the
house and land package or renting the land.
"The scheme envisages the Federal
Government initiating a rolling fund of $3 billion over three years to purchase
bulk land from the private sector helping smooth out the high and low demands
of the property cycle providing the industry with more financial certainty."
Media
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