Saturday, 14 July 2007

Sunday Age Article - It's simple: more land for more people - 15 July 2007

When my parents brought an empty block of land in Box Hill North in the 1950s, my grandfather nearly cried – shocked his daughter would choose to live so far from the city.

When Mum’s sister and new husband also brought a block nearby, he wondered what the heck he’d done wrong.

Mum would often laugh about my late grandfather’s reaction, “I’ll never forget that look on his face” she’d say.

Of course, I never did see ‘the look’ at the time, but I’m sure I saw a carbon copy of it on Mum’s face a few years ago when I told her my wife Pam and I were moving to Chirnside Park.

In many ways, this is the story of Melbourne – young families moving outwards to affordable homes with backyards to raise families in new and developing communities.

But this story is under threat.

The first homebuyers of today don’t have the opportunities others before have had.

Housing that little bit further out, where so many young homeowners make their start, has become more pricey.

There are fewer blocks of land being made available and this pushes the price up as more people compete to buy them.

The price of materials to build the actual house hasn’t changed much in recent years, but the cost of the land and all the government taxes and charges have.

We all know this because vacant blocks of land in our suburbs cost much more than they did just a few years ago.

The Property Council of Australia recently concluded that “restrictive land release policies of state and local governments” were a main driver of skyrocketing housing costs.

Even Policy Exchange, a UK research organisation, found it was state governments in Australia who had “threatened” the Australian dream by “reducing the quantity of land released for housing”.

On top of steep land prices, there are also massive government charges, taxes and levies (around $30,000 on average) forced on new homebuyers - and that’s before a single brick is laid.

For many homebuyers this is their single largest expense and can be as much as their deposit.

Melbourne will need more than 600,000 homes to cover growth in the next 25 years. But instead of planning for this growth, Labor keeps trying to squeeze us in, refusing to release enough new land for housing or build the infrastructure that would allow new communities to develop.

Labor has a tendency to lecture people on where and how to live. They have a deep distaste for people moving to the urban fringes. Both Justin Madden at a state level and Kim Carr federally, have launched vitriolic and condescending attacks against so-called ‘Mc Mansions’.

They may not understand why everyone doesn’t want to live in a flat in Brunswick, but that shouldn’t affect policy decisions.

That’s why we don’t need a ‘housing summit’ to tell us what’s threatening Melbourne’s story and making housing unaffordable.

Bob Hawke held a summit in 1989, and afterwards confidently concluded this would mean “the people of Australia who were looking for homes would not be faced with such high prices”.

The price of a house in Melbourne went up 14 per cent that year and 13 per cent the next.

As it happened, house prices then plummeted in the early 1990s, but it had nothing to do with Hawke’s summit and everything to do with Keating’s recession. Putting a million people out of work meant loan repayments couldn’t be met and we had a housing fire sale.

The story of Melbourne is the story of people making the perfectly sensible decision to move further out of town where they can have plenty of space and the kind of home they want.

At the moment, however, it appears that Labor is allowing their ideologically driven distaste for this long standing trend to stand in the way of supporting those who move to areas like where I live in the outer eastern suburbs.

Kevin Rudd shouldn’t need another summit, or meeting, or talkfest or panel or committee to understand this. If he wants to talk to someone, he should talk to Steve Bracks.

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