Local councils show appalling indifference to housing shortage

16 June 2010

The Australian Local Government Associations attempts to deny responsibility for Australias housing shortage shows an appalling indifference to the plight of home buyers and renters, according to the Urban Taskforce.

This morning the Sydney Morning Herald and The Age both detail the Australian Local Government Associations (ALGAs) State of the Regions report, which is due to be formally released at 12.45 pm today.


The ALGA report denies that local planning laws are to blame for the housing affordability crisis and instead says the problem lies with the federal government’s failure to provide jobs and infrastructure.


The Taskforces chief executive, Aaron Gadiel, said that independent figures had confirmed that the current national housing shortfall is 178,000 homes, with a projection for it to grow to 308,000 dwellings over the next four years.


Every credible assessment of this problem has concluded that this shortage flows from systematic problems in town planning laws, Mr Gadiel said.


Only the local government association could declare that black is white and pretend local councils are blameless.


Mr Gadiel said the most recent assessment from the National Housing Supply Council warned that planning approval and development assessment processes generally add time, uncertainty and costs to the development process.


They said the constraints would make it difficult to supply enough housing in south-east Queensland, Melbourne, NSW and Perth.


Mr Gadiel said the shortage makes housing more expensive than it needs to be.


A massive 37 per cent of low-income renter households are officially in rental stress”that is, they are paying more than 30 per cent of their gross household income in rent, Mr Gadiel said.


Just 28 per cent of homes sold are currently affordable to moderate-income households.


Were seeing increased homelessness, overcrowding, and adult children remaining at home for longer periods.


Mr Gadiel criticised calls by the ALGA president, Geoff Lake, for the Federal Government to focus on demand issues instead of the supply-side.


The ALGA report argues that home buyers should face tougher lending restrictions, such as an increased deposit. Rather than supporting extra home construction, theyre arguing that less people should have the opportunity to buy a home, Mr Gadiel said.


That would be a dreadful public policy outcome, that would leave many tens of thousands of households worse off.


Mr Gadiel said there was a strong case for greater infrastructure investment by the federal and state governments, as well as town planning reform.


However, even when big infrastructure investments are made, local councils frequently resist opportunities to authorise extra housing to make proper use of new infrastructure.


The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.


The construction activity made possible by property developers contributes $78 billion to the national economy each year and creates 849,000 direct jobs.



Download PDF Version