The Property Council of Australia has welcomed the NSW government’s plan for housing affordability, calling it a strong step in the right direction to solving the housing affordability crisis.
“Overall this is a good plan – it balances supply and demand initiatives and shows the government has listened to the industry and the people of NSW,” said Cheryl Thomas, Property Council of Australia’s deputy executive director for NSW. “The crucial aspect that will define its success will be increasing housing supply. Initiatives that increase demand, such as grants and tax incentives, must be matched by initiatives that boost supply and it appears the government has heeded this advice.”
Planning measures drive housing supply
Thomas called the state government’s move to increase the number of Priority Precincts to 15 a “good move,” as it would mean that transport and infrastructure investments can be integrated with land use. It would also streamline the decision-making process.
“More housing supply must not be restricted by misleading preconceptions of what increased density is – solutions can be found that provide great liveability options for the community that include services, green space and transport,” Thomas said. “Smaller lot sizes and incorporating codes for faster housing approvals in the priority precincts is a move that will enable diverse housing to be built more quickly – good news for those seeking a home.”
Thomas also welcomed the introduction of planning panels, calling it a “decisive move” that would depoliticise the development assessment process.
“Representatives on the panel must have specialised expertise so that we do not end up with unfair outcomes for proponents and appeals,” Thomas said. “The fact that councils can be incentivised to meet housing targets and update Local Environment Plans is important. There must be a carrot and stick approach to ensure there is strong strategic planning at a local level and the Greater Sydney Commission is empowered to enforce their strategic outlook.”
Changes to taxes could have mixed results
The doubling of the stamp duty surcharge on foreign investment to 8% and upping land tax on foreign buyers to 2% is an approach that must be closely monitored. “Like any market, if you tighten the screws too tightly, you may inhibit growth,” Thomas said.
She pointed out that foreign investment promotes economic and job growth, and contributes to the state’s economy. “We welcome the government exempting foreign developers that provide housing supply from the surcharge and land tax increases; their original inclusion in the initiative was an unintended consequence that has now been put right.”
Thomas also welcomed the Berejiklian government’s changes to stamp duty. “The full exemption from stamp duty for first home buyers on new and existing houses up to $650,000 is to be welcomed, but the full exemption threshold could be increased. It should reflect the median house price in most Sydney suburbs and indeed in cities like Wollongong and Newcastle that sit at around $800,000.”
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