The recent debate on affordable housing in the NSW Parliament demonstrated a range of proposals for extra taxes on housing that would ultimately make Sydney housing less affordable, says the Urban Taskforce.
“The Greens have proposed a 30% affordable housing tax on all new housing followed by the Labor Party with a 15% tax and at the more realistic end the Liberal Party support a 5 – 10% target based on an economic analysis,” says Urban Taskforce CEO, Chris Johnson. “It appears that those not in the government spruik populist percentages that imply they are listening to the people and have a magic solution to housing affordability. The government, on the other hand, understand that excessive taxes on developments will impact on supply with the result that there is less development and Sydney’s housing crisis will worsen.”
“The debate in the NSW Parliament on Thursday, 3 August was initiated by a petition from the St Vincent de Paul Society calling for a 15% affordable housing levy as part of an inclusionary zoning approach to providing cheaper homes. While the Society’s approach is well meaning the difficulty is that the levy cost must be borne by someone and this is initially the developer of new housing who will then pass this onto the purchasers of the remaining 85% of homes. The end result will be to increase the cost of new housing across Sydney significantly. The other option is that an excessive tax could make new housing projects unviable and therefore not proceed so increasing the housing crisis.”
“It was good to see the NSW Minister for Housing, Anthony Roberts, in the parliamentary debate stressing the need for ‘a sensible and balanced approach to increasing affordable housing, which must be implemented in a way that does not impact on supply.’ The Minister went on to reinforce the importance of financial viability to ensure that there is not a negative impact on development feasibility or impede overall housing supply.”
“By comparison Luke Foley, the Labor Party leader stated that his party had adopted a target of 15% affordable housing on private land with no mention of the impact on overall housing supply.”
“The Green’s spokesperson, Jenny Leong, saw the fact that there was a bidding war on percentages as ‘a true sign of a community campaign that is moving in the right direction’. The Greens then stated their proposal for inclusionary zoning as a 30% levy. So every new housing project would be required to give away 30 apartments out of every 100 that were built with no compensation. The Greens policy would stop all housing production in Sydney.”
“The Urban Taskforce has proposed ways to achieve long term supplies of affordable homes by providing incentives to the development industry. We are keen to work with the NSW Government to develop an approach that is economically viable but the government must also control the large number of other levies that councils want to put onto new housing projects.”
