National Housing & Homelessness Agreement Review points to the need for immediate action on supply
The Urban Development Institute of Australia welcomes the release of the Productivity Commission’s National Housing and Homelessness Agreement (NHHA) Review and urges Government to implement supply boosting measures which should include encouraging states and territories to boost development ready land.
The Productivity Commission explicitly stated that the next NHHA should recognise the importance of housing supply as a solution to housing affordability and include a requirement for States and Territories to commit to targets for new housing supply in major urban areas.
“The NHHA Review has made some critical common-sense recommendations that will help break the affordability crisis crisis and we urge government to adopt measures to accelerate housing supply as quickly as possible,” said Max Shifman, UDIA National President.
In line with UDIA recommendations, the Productivity Commission (PC) statements included that Federal, State and Territory Governments recognise that:
- A targeted approach to housing supply needs better data and measurable targets on housing, zoning and the development pipeline that is monitored and managed by an independent body like the National Housing Supply and Affordability Council.
- Revising zoning regulations, increasing density, greater housing diversity in planning rules and preventing developer charges cost-shifting community services onto new homeowners are all necessary.
- Building a residential dwelling requires both equipment and workers and an independent review of the construction sector should be commissioned with a focus on identifying reforms that can boost productivity (and improve affordability).
- Inclusionary zoning should not be used to tackle rental affordability.
- Removing distortionary barriers to institutional investment could increase supply. This would include Build to Rent or affordable Build to Rent but governments should not tip the scales in favour of this investment.
“We are pleased that the Productivity Commission has listened to all stakeholders and has seen that focus is needed on measures to boost supply of housing across the spectrum. This broad approach is what is needed to help all households,” said Max Shifman, UDIA National President.
Critically, the Productivity Commission recommends that Housing Ownership incentives should be more tightly targeted to Australians in need of subsidies to get into their own home and also proposed the use of tenure-neutral “portable subsidies”. These subsidies are intended to enable social and affordable housing renters to choose where they live based on their preferences, rather than the type of financial assistance available for different types of housing. This means the entire pool of affordable and private housing is open to these households.
“Detail is required on the Productivity Commission’s proposals for portable subsidies and we are keen to help the governments work through the policy options to get the best outcome for Australians,” said Mr Shifman.
Many parts of Australia are already experiencing a severe housing affordability crisis and the costs of delivering new housing continue to escalate due to a perfect storm of a shortage of development ready and, materials and skilled workers.
Home ownership levels across the nation are declining. Greenfield lot releases and sales have declined by 45% over the last 12 months due to lack of land supply and capacity, at a time when according to ABS data, multi-dwelling approvals are at the lowest levels since January 2012.
“The Productivity Commission has correctly recognised that the causes of the current affordability crunch are a combination of lack of development ready land, skilled worker shortages, insufficient zoned land and clogged approval systems which take years to deliver new dwellings to the market,” added Mr Shifman.
“UDIA looks forward to working with Government to implement the Recommendations, to help shape Australia’s economic recovery and ongoing prosperity,” said Maxwell Shifman.
Deanna Lane | National Media & Communications Manager | 0416 295 898 | email@example.com