Page 3627 - Week 12 - Tuesday, 22 October 2013
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Although average incomes in the territory are high, the ongoing strength in demand for properties to purchase and rent has meant that housing affordability does indeed remain a key issue, particularly in the lower two income quintiles.
This is why the government has pursued a number of policies aimed at putting downward pressure on prices in the market.
Last year the government released phase III of the affordable housing action plan, which included 14 measures to improve affordability. Some of the initiatives have already been implemented—for example, reducing land tax on properties with average unimproved land values between $75,000 and $390,000; introducing variable thresholds for affordable housing based on dwelling size; making significant cuts to stamp duty on every single property in the territory, a point I will return to in a moment; increasing the property and income thresholds for the homebuyer concession scheme; and being innovative in looking at unlocking new parcels of land for new housing, particularly by supporting small clubs to assess the viability of their sites for residential development.
The following initiatives are underway: investigating higher targets for affordable housing requirements in our englobo releases; encouraging institutional investment in affordable rental properties; offering lease variation charge remissions to facilitate the redevelopment and adaptive reuse of commercial accommodation that delivers affordable housing; developing a sustainable land and affordable housing guide to assist industry; and releasing land for short-term accommodation.
Other initiatives that are more complex and will be undertaken in the medium term include increasing the supply of affordable rental properties through the transfer of land or surplus properties to the community housing sector; assessing and considering options for facilitating residential development on other underutilised community facility sites; investigating a requirement for the delivery of public and community housing in large infill and greenfield residential developments; and exploring options for extending the OwnPlace scheme into englobo and joint venture developments. These are just some of the initiatives the government is pursuing.
We have made a significant change to our policy focus around the encouragement of the supply side of the market. The only effective way to put downward pressure on prices is to dramatically increase the supply of housing. In the statistics I quoted in question time today, we have seen just how the market has responded to that. In the last quarter, there were more dwelling approvals in the ACT than there were in Tasmania and the Northern Territory combined.
We are seeing the market responding to a number of signals from government, particularly the increase in the first home owner grant, focusing on new accommodation. We do not push the price of existing homes up by having an increased amount of money in people’s pockets chasing the same number of houses. That is inflationary, and the evidence over the last decade is that it is one of the major reasons why house prices have increased—because the supply has remained the same and yet demand has been fuelled. What is needed is supply-side solutions, and that is what the government has in place.
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