The Property Council of Australia says that the groundbreaking report “Australia on the Move” prepared by Bernard Salt of KPMG should ring loud alarm bells for Australia’s system of land use and population policy making.
“For generations, the growth and development of our nation has been subject to a form of ‘policy on the run’ – growth has typically been allowed to happen without the appropriate frameworks of infrastructure and land use provision,” said Peter Verwer, Chief Executive of the Property Council of Australia.
“Accidental cities, and regions in need of rescue: these are the legacy of a mismanaged approach to housing growth and development in this country since the post war period.”
The Property Council had commissioned “Australia on the Move” to identify the extent of housing growth needed by 2031 to accommodate a growing Australia, taking into account factors such as rising death rates for baby boomers, shrinking household size and immigration.
The report has identified, city by city, where housing growth is going to happen and the volumes of growth required to meet demand.
Among its findings:
- Declining household size will drive accelerated housing growth to around 2020 with around 142,000 new dwellings needed each year, after which rising deaths of baby boomers and other demographic factors will slow housing activity to around 109,000 dwellings each year.
- By 2031, the average household size will be around 2.38 persons – well down on the 2.74 average recorded in 2001.
- Areas likely to record the most housing growth relative to their size in 2001 are typically regional or ‘sea change’ locations: Mandurah in WA leads with 223% growth in dwellings from 2001 to 2031, followed by Hervey Bay (Qld) with 194%, the Sunshine Coast (Qld) with 149%, Gladstone (Qld) with 123%, the Gold Coast-Tweed (Qld) with 112% and Cairns (102%).
- Areas likely to record the most growth in dwelling numbers are typically established capital cities – led by Sydney with 881,000 new dwellings in the 2001-2031 period, followed by Melbourne (786,000), Brisbane (528,000), Perth (426,000), and the Gold Coast-Tweed. In raw numbers, the Sunshine Coast is likely to produce almost as much dwelling growth in the period (138,000 dwellings) as Adelaide (150,000 dwellings).
- The move to housing density is producing marginal change only, with the proportion of detached housing by 2031 falling to 71%. Even in Sydney, which by 2031 is predicted to have 43% of all dwellings as attached housing, will rank equal only to US cities such as San Diego in terms of density: this is a long way from cities such as New York.
The report was released at the launch of the Property Council’s new residential development advocacy arm, the Residential Development Council – at an invitation only Industry Leaders Summit at Noosa on Thursday (9th June).
The Residential Development Council has been formed with the support of CEOs and senior management of some of Australia’s most prominent residential developers, including Stockland, Mirvac, Lend Lease, Meriton, Australand, and Multiplex.
On its agenda are a range of issues plaguing the residential development sector, and which add to costs and delays for no apparent benefit, including:
- Redundant local and state development approvals processes, which delay market decision making and add to housing costs for Australians.
- Inconsistent local and state planning policies, which create jurisdicational problems for residents and developers alike.
- Planning schemes written in such arcane form as to only be intelligible to lawyers and which discourage community engagement.
- The absence of a national approach to population and housing growth.
- Infrastructure deficits in established areas and excessive infrastructure headworks charges in some emerging residential areas.
- Inconsistent ESD principles, many of which reflect ‘flavour of the month’ political agendas and not genuine environmental outcomes.
- Worsening problems with housing affordability, driven by input cost pressures and regulation as much as by market demand.
“The report goes beyond merely painting a picture of future population numbers: it now demands answers to a series of compelling issues which the nation has, until now, typically avoided,” Mr Verwer said.
He said these included things like:
- Is there sufficient land supply in non-environmentally sensitive areas, to accommodate growth in coastal and regional communities, and if not, what are the consequences of not identifying land supply constraints now?
- Can urban infill accommodate a greater proportion of future housing or will antiquated local and state planning systems deter development, if NIMBYism doesn’t do so first?
- Should Australia be prepared to move towards a more consistent set of planning and development regimes for development, linked to infrastructure provision which leads – rather than lags – housing growth? Can the current system be improved upon?
- Are current measures to promote skilled trades going to be adequate in light of forecast demand?
The Residential Development Council will begin work in formulating detailed industry responses to these and other pressing issues.
Its aim, Mr Verwer said, was to provide ‘solution based’ policy and research papers, designed to assist public policy makers understand market dynamics and respond with realistic and helpful regulatory responses.
To access the KPMG media release 'Seachange cities' to re-invent themselves over first three decades of 21st century, click here.
For comment on the statistics contained in ‘Australia on the Move’, contact:
Bernard Salt, 0404 875 705 For comment on the public policy implications of the report, contact:
Peter Verwer, CEO, Property Council of Australia, 0407 463 842
Ross Elliott, Executive Director, Residential Development Council, Property Council of Australia, 0407 177 591