State governments have been called on by the Residential Development Council to lift restrictions on the supply of land to ease the housing affordability crisis across Australia.
The RDC’s call came as both Prime Minister John Howard and out-going Reserve Bank Governor Ian Macfarlane said state government land release policies, and the growth of up-front levies on new homes, were making it harder to enter the housing market.
"Until state governments around Australia start releasing more land and stop using the development process as a method of raising revenue, we are going to continue to have a problem with the affordability of housing,” Mr Howard said.
"It's pretty apparent now that reluctance to release new land, plus the new approach where the purchaser has to pay for all the services upfront, is having an effect," Mr Macfarlane said.
RDC Executive Director Ross Elliott said that the combination of state government restrictions on the supply of land for new housing and rapidly escalating fees, charges and compliance costs were making housing less and less affordable.
“A landmark RDC study showed that taxes and compliance costs on new homes were now making up a quarter to more than a third of the price of a new home. Most of these costs had been introduced in the previous five years,” Mr Elliott said.
“Studies by the UDIA and HIA also called for the release of more land by state governments.
“Now the Prime Minister and the Reserve Bank Governor are also warning of the problems land rationing and excess fees and charges are causing for housing affordability.
“State governments must stop reaping windfall revenues and release extra land rather than making housing unaffordable for many Australians.”
Ross Elliott, Executive Director, Residential Development Council, Property Council of Australia, 0407 177 591