Rudd declares housing a priority for 2010

Premiers to take reigns on housing
Tuesday, 08 December 2009
(from rebonline.com.au)

The Rudd Government has declared housing a priority for 2010, as a lack of supply and an increase in population drags affordability downwards.

From the beginning of next year, premiers and chief ministers agreed treasurers, rather than housing or planning ministers, will develop a reform agenda to tackle housing supply and affordability issues.

In a joint statement released by Kevin Rudd and Treasurer Wayne Swan, the government said every jurisdiction recognised that addressing housing supply is central to the challenge of ensuring housing remains affordable in the future.

“Ensuring an adequate supply of housing as our population expands in coming decades is also a key economic challenge, impacting on the mobility of our labour force and our capacity for sustainable growth,” the statement read.

According to the statement, premiers and treasurers will be asked to utilise the land audits recently undertaken by the Commonwealth and state and territory governments to progress the release of surplus land; implement more efficient approaches to Development Assessment processes; and develop a timetable for housing policy reform for consideration at the first COAG meeting in 2010.

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All sounds very general but we will wait and see what plans the Federal govt comes up with for 2010. I think the speeding up of current Dvpt processes will be first on the list given the recent activity in this area.

 

It would be good for Australia, but it makes for a pretty bearish prospect for property through. Supply issues are one of the key elements supporting property prices.

So if the government is planning to "tackle housing affordability" that directly translates to decreasing house prices.



I guess property investors need to hope that the government are about as competent at fixing this issue as they are at fixing all the other issues... from this perspective maybe the fact that the government is getting involved is a bullish sign.

 

Not bearish at all!

The government is promising nothing but spinning wheels and going no where. They've promised an agenda and that one bunch of ministers (who might now have an idea of the problem) will be swapped for another bunch of ministers.

They know where land is available, but it's too expensive to develop with all the government red tape - and interest rates won't help (not to mention the ETS).
They (ie, the tresurers) will look at speeding up the processes (in other minister's departments?) - this will lead to more reviews into fees, charges, federal vs state roles, arguments over removing stamp duties for GST distributions (again), ...
But they'll develop a timetable ... not a solution ... which the various public services need to solve before changing their current processes ... over how many years?

In the meantime, the housing shortage will get worse, which has one effect on prices. When something does come out of all the reviews and setting agendas, we'll have another few years building shortfall to catch up on, so it will take even longer to rein back in.

They're committing to very little, but setting up shortage driven price rises for a few years and then a decline (slowing) in maybe 5 - 7 years when cheaper house building (in new / less sought after locations) catches up.

Just my opinion, but I think it looks like re-inforcing the same old property cycle.

Dave

 

Sounding a little jaded there Dave
Then again I think many of us are also tired of the endless rhetoric that seems to come out of pollies mouths - you're not alone.
Agree with you about the housing shortage- it will definitely lead to more committees, reviews, draft papers and policies etc that will eventually be overturned or quickly forgotten as governments change hands and new ministers have new ideas. More public $$$ spent wasting time on proposed "solutions" that will be shelved and forgotten, just like so many others. Now who's sounding jaded

 

It just makes you think there has gotta be a better way that doesn't include dictatorship

 

There is and it's called increased banking competition.

A gov. owned bank which will provide low interest housing loans to FHB's
and construction loans at reasonable rates to developers.

They can still make money from the FHB's but they don't need 100% profit margin like the other banks...

 

Hi Jacque,

Maybe a little jaded by the government saying they're going to tackle affordability, and then acting to the contrary. The infrastructure stimulus is also kicking in, just in time to reduce the labour pool needed to address the housing shortage. Then there will be mandated FO broadband installation (watch the price as it shifts from competitive to compulsory) and increasing minimum energy efficiency ratings - good ideas, but at a cost. ... and this is helping to tackle affordability?

Affordability may come through smaller houses and new lower cost materials and construction techniques. None of these seem to be on the radar.

So yes I am a bit jaded, only because I'm not sure if the government is just taking us for fools, if they truly have no idea, or simply can't coordinate their policies. On the other hand for property investing I'm very optimistic! I'm happy to see the value of my IPs go up. It would have been nice to have more steady price rises but the government seems set on creating another boom-bust cycle.

Cheers, Dave

 

I have thought the same thing before, but it involves the major problem of government, and unfortunately government don't do anything really well except look out for themselves.

I think more competitive, though regulated, not-for-profit banking institutions would be good. Though this would need to be coupled by tighter regulation on for profit banking institutions as well so they can't bully out the altruistic organisations.