27 November 2014
The report on Foreign Investment in Residential Real Estate by the Kelly O’Dwyer committee supports the current framework for foreign investment in new dwellings so that housing supply can be increased, but the Urban Taskforce says that any administrative system reforms must not slow down investment and housing production.
“The positive from the Kelly O’Dwyer committee report is that the review supports foreign investment into Australia’s housing market, particularly as Australia is a relatively small nation,” says Urban Taskforce, CEO Chris Johnson. “However, the report proposes a number of system reforms including improved auditing, new marketing approaches and the introduction of a fee to cover application costs.”
“These reforms may well be desirable but they must not become so onerous for the applicant that we see a slowing down of foreign investment. This would be bad for housing supply and detrimental to our construction industry and economy.”
“Kelly O’Dwyer, the Chair of the Standing Committee on Economics, raised concerns about housing affordability and says this is due to the lack of land supply, state planning laws and local council red tape rather than through foreign investment. Clearly these areas need to be looked at by state governments around Australia.”
“Red tape, overregulation and anti-competitive planning systems in state governments need reform. In Sydney alone we need to produce 33,200 new homes each year to meet demand. Our most recent levels of production has Sydney sitting at 22,750 new homes produced. This is an encouraging lift in dwelling production from previous years but still nowhere near the target.”
“There are major housing supply problems in cities like Sydney and while there have been recent increases in housing approvals, these have been partially through increased foreign investment in new housing stock. Without a big boost to housing supply the price of the average house in Sydney will become unaffordable for many families. It is therefore important that the federal government does not send the wrong signals to foreign investors through the proposed system reforms. This is a delicate balancing act that needs careful management.”
Radio Coverage 1, Radio Coverage 2, Radio Coverage 3, Radio Coverage 4, Radio Coverage 5, Radio Coverage 6
