Page 2330 - Week 07 - Thursday, 17 August 2006
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MR STANHOPE: I thank Dr Foskey for the question. It is an important and timely question. I think that it is not necessarily fair to suggest that the government has not responded to earlier work and inquiries that have been undertaken in relation to affordability and affordable housing within the territory. That is not the case. Significant planning and thought, particularly the work of ACTPLA and the LDA, have been involved in and around and directed at ensuring, to the extent that government has some capacity to influence the levers in relation to affordability, precisely that.
Both ACTPLA in its planning and the LDA in the execution of its land selling responsibilities are very mindful of affordability and we have quite specific policies and proposals in place in relation to that. But affordability is, quite obviously, a very complex mix. There is a whole range of factors and there is a whole range of players. For instance, one theory that has over time achieved particular popularity is that the granting of stamp duty holidays or a reduction of stamp duty under certain thresholds is a sure and certain way of achieving some affordability outcomes.
I think that all of the evidence, much of it anecdotal, available in relation to that is that, in fact, reductions in stamp had the complete reverse effect from that which was hoped for or expected. In other words, investors taking advantage of reductions in stamp simply entered the market more vigorously and pushed up prices. There is significant anecdotal evidence now that some of the levers that governments have attempted to manipulate in the past have not just not worked but that they have been counterproductive.
It is complex and it is something which every jurisdiction round Australia is dealing with. There are different measures of affordability. At one level—in relation to the capacity to pay as a measure of affordability, which I think is the most rigorous—the ACT is the most affordable jurisdiction in Australia. We have the lowest ratio of household disposable income going to housing of any place in Australia by far. Almost half the level of average disposable income in the ACT is expended on housing as opposed to New South Wales, which is significantly different. House prices are higher in Sydney, compounded by far lower average disposable incomes. The double whammy is experienced there.
Housing affordability in the ACT is at about half of the rate or level of affordability within New South Wales and round Australia. So it is not right to say that we have not responded and we do not continue to respond, noting the level of affordability, the highest rate of affordability in Australia. Nevertheless, a significant tranche or proportion of the community in the ACT is truly battling. I have children of my own and I know through their experience the significant distress that house prices now cause for first home buyers and people seeking to enter the market. This is a genuine issue of enormous import for those of us that grew up never doubting for a minute that we would buy our own home and do so without difficulty. It is to that that the government is responding. I do believe that every jurisdiction round Australia is battling with that. The task force that I have initiated is across government.
Dr Foskey, I want, essentially, precisely what you have asked whether we will deliver. The terms of reference are not that specific, but what you ask in terms of time lines and specific ideas, specific directions and specific initiatives is, essentially, what I am looking for ideas on. I do want specific ideas. I want a better understanding of the
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