Page 3239 - Week 09 - Tuesday, 19 August 2008
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not the sort of tentative half-baked model of competition that we have seen under Jon Stanhope’s leadership over the past few years. We had no competition for a while and what we see at the moment is a small amount of competition. We need to see more competition. We need to see a land supply strategy that is genuinely responsive to the market, not just releasing 15,000 blocks over the next few years, come what may.
We do not know what the market is going to do. We do not know whether the market is going to slow down or speed up. What we do need to be doing is ensuring that we do not flood the market. We do need to be ensuring that we are ready to respond so we are not constantly putting upward pressure on prices through slow land release. We have seen the people camping out in the last couple of weeks. I think that is emblematic of this government’s failure on land release and it is emblematic of their failure in relation to housing affordability generally.
MR MULCAHY (Molonglo) (4.13): This matter of public importance is something of a triumph for government spin. It is designed to assure all of us that the problem of affordable housing and the financial difficulties faced by ACT families have descended on us for some inexplicable reason, and that it is the government that will once again alleviate this unexplainable crisis. In fact, nothing could be further from the truth. It is the government which is the primary impediment to affordable housing in the ACT and it is the government which is adding to the financial burdens faced by families.
Make no mistake: it is the ACT government which imposes its massive tax burden upon the people of Canberra and it is the territory government that strangles the productive power of property developers with red tape, regulations, interference and taxation. I think that somebody needs to provide a basic course in economics, especially for the proponent of this MPI, because the affordability which Ms MacDonald has spoken about is a function of supply and demand in the housing market. It is the supply of housing available in the market and the demand for this housing that determine the prevailing price of housing and the prevailing rental costs. And it is the supply of housing that the government does its best to cripple through the maze of arbitrary red tape that property developers are made to wander through.
The level of taxes on property also has an effect on the price of housing, and the government has done its level best to ensure that these taxes are substantial. With respect to the planning reforms that we were told would deliver dramatic changes and improvements, and that occurred from the end of March, I have not yet found anybody involved in the property sector who has got a good word to say about them. Mr Seselja talked about the pergola builder, but I am hearing it from much larger developers, and they are all saying to me that things are still hopeless in terms of the planning process. That, of course, finds its way into holding costs and therefore into the ultimate price of housing.
The supply of affordable housing is a function of the total supply of housing. It is not a matter of coming in and trying to get smaller houses built rather than bigger houses; it is a matter of allowing houses to be built as the demand for them dictates. When a large house is built, someone usually moves out of a smaller house to live there and someone else often moves out of an even smaller house to live in the house just
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