New tax to push up the price of new housing in City of Sydney

The City of Sydney’s Affordable Housing Program, endorsed by the Minister for Planning, Rob Stokes, introduces a charge for the delivery new homes that will now apply across Central Sydney and much of the City of Sydney local government area. Minister Stokes announced today the making of a new plan that will push up the price of new housing in the City of Sydney.

The NSW Government has signed off on a new tax of up to 3% on the production of new homes in the City of Sydney Council area.

Both the Minister and Clover Moore are well meaning, but you don’t create affordable housing by adding additional charges to the production of new homes.

The NSW Productivity Commission recognised this conundrum in their review of infrastructure fees and charges. This change goes in the very opposite direction. This is a new tax on new homes to be paid by new home buyers.  Prices will go up.

Housing affordability is one of the biggest issues facing governments at all levels. But the NSW Government has simply done what the Mayor of Sydney wants – no questions asked – no economic analysis applied.

The key to housing affordability is more supply – not extra taxes on those who are trying to solve the affordability problem by creating more homes.

It is high-time the penny dropped with the NSW Government – it is the drought of planning approvals that has caused this housing affordability crisis and urgent policy reform is needed.

Unfortunately, while well meaning, today’s announcement is a step in the wrong direction.  Clover Moore is no-doubt popular – but we are in trouble if we take her advice on housing affordability!

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