Congratulations to NSW Premier, Gladys Berejiklian, on her successful re-election, but her new government must ensure that the slowing new housing industry is lifted says the Urban Taskforce.
“The re-election of the NSW Government reinforces their commitment to infrastructure across our cities and regions.” says Urban Taskforce CEO Chris Johnson. “But the infrastructure must be balanced by new urban development to support our population growth.”
“During the election there was a lot of negative coverage about the extent of development particularly in Sydney and this has led to a negative culture in councils and government departments about new development. The impact of this negative culture has been that NSW apartment approvals have dropped by 70 percent in the last year according to the Australian Bureau of Statistics (ABS), and over the same period loans to investors have dropped by 30 percent in value according to the ABS. The number of pre sales for new dwellings has also slowed dramatically over the last 6 months. These negative statistics will mean the supply of new homes will slow down dramatically over future years unless the government takes some actions to stimulate development.”
“The restrictions on bank funding of new developments is totally based on getting all planning approvals in place before the banks will lend money for new projects. If approvals are not happening, as we are currently seeing, then investment in new projects collapses. The results of this will be loss of jobs, loss of property taxes to fund infrastructure and unaffordable housing”.
“The Urban Taskforce believes the Berijiklian Government will need to review key planning policies related to new development as many seem to be on hold. If there is no certainty about the planning system then many projects will be delayed until there is clarity on just where the government wants new development to be located. We are keen to meet with the new Minister for Planning to discuss the lack of clarity in the planning system that is stopping the private sector from delivering new housing.”
“The slowing housing industry and the reduction in the sale of existing homes means the NSW Treasury will receive less income from Stamp Duty and this will impact on the health of the NSW economy. There is also a potential flow on to the 300,000 direct jobs in the residential building sector that could be reduced significantly as the production of new homes slows down.”
“While the re-election of the Berejiklian Government could imply that the current approach to new development will continue our belief is that the government must lift the industry from the negative pre-election environment into one that supports younger people who are looking for affordable urban housing close to transport, jobs and services.”
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