05 June 2008
The shared equity scheme proposed by the NSW Opposition will not improve housing affordability, according to Aaron Gadiel, chief executive of the Urban Taskforce.
In fact, it is likely to make homes more expensive. Thats because the problem in NSW is a lack of housing supply.
Only 29,000 new homes were built in NSW last year, down from an average of 44,000 in 1990s.
When the supply of housing is limited, giving more money to homebuyers will only force prices up.
Its a very inefficient way to tackle housing affordability and will make housing less affordable for those who do not receive the government cash handout.
If the government has an extra $640 million to invest in making housing more affordable, they should use it to boost the supply of new homes on the market.
More new homes will be built if the government was willing to fund more infrastructure like roads and utilities.
The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.