The Property Council of Australia has welcomed the release by the ACT Government of consultants’ final reports on Change of Use Charge (CUC) in the Territory.
Property Council ACT Executive Director, Catherine Carter, said that the reports, separately prepared by Professor Des Nicholls and Professor John Piggott, appear to respond to some of the issues, but not all of the areas of concern which have been raised by the Property Council about proposed changes to the CUC system.
“To begin with, the Property Council is very concerned about the proposed implementation date of 1 July 2011 as currently contemplated by the ACT Government,” Ms Carter said.
“The Property Council understands that there are a very substantial number of development applications which have proceeded through the development approval steps but which have not been converted into building approvals due to the fact that the amount of the CUC has yet to be resolved. Industry has basically stopped converting leases.
“If it in fact transpires that there is a 13 month delay within the industry in finalising residential crown lease variations, there will be a substantial interruption of residential land supply to the market. In addition to the impact on workforce in the Territory, the major effect will be that problems with housing supply and affordability will be exacerbated, which in turn will lead to increasing pressure on rental levels on existing stock.
“A further effect will be a significant reduction in government revenue derived through stamp duty, land tax and rates.
“The Property Council does not believe that government, nor prospective home owners, can afford a 13 month interruption of supply. Accordingly the Property Council calls on the ACT Government to urgently move to the introduction of an interim charge of, say, a maximum of $10,000 per residential unit, until all these issues are resolved.
“In the meantime, the Property Council urges its members, the wider industry and the community to look carefully at the reports and to analyse what they mean for them. At the very least, as stated in the first Nicholls report, it will lead to reductions in existing house prices in areas suitable for redevelopment, an increase in the final sale price for finished units, or a combination of both.
“The Property Council will continue to work with government to ensure that their number one priority of achieving housing affordability in the Territory is maintained, and to ensure another government priority of achieving 50 percent redevelopment of existing areas to accommodate population growth, is achieved.
“Further work will need to be done to ensure that current proposals which are anti-land supply, anti-housing affordability and anti-sustainability are amended to ensure an outcome that all Canberrans can afford to live with,” Ms Carter said.
For further information contact:
Catherine Carter, Executive Director, 02 6248 6902 or 0412 330 079