Creating for Generations

Fixing housing affordability

Good housing choices knit communities and cities together. They offer people the option to live and work where they wish, match housing options to their lifestyle and family needs, and the security of a good home.

Getting this right matters because people need housing choice and affordable options as they move through life.

We can make more housing available at an affordable price if governments work together to:

• Bridge the deposit gap for people wanting to get into the housing market by providing low deposit home loans similar to the Keystart model in Western Australia
• Ensure we have a sufficient supply, diversity and choice of housing by embedding a sustainable pipeline of land release and urban renewal opportunities in the strategic plans for our capital cities
• Reduce the burden of taxation on new housing – where government taxes, charges and regulatory costs can add up to 50 percent to the price
• Curb the time, cost and red tape built into planning approvals
• Recognise the importance of negative gearing to a healthy rental market by maintaining it
• Giving renters more choice by seeding a new build-to-rent sector in Australia that brings institutional capital to the table
• Encourage pensioners to downsize by quarantining a portion of surplus cash from the pension eligibility test.
• Measure the market – and performance of governments – by capturing and providing better data on housing supply and forecasts

The Property Council of Australia’s 10-point plan for housing affordability identifies solutions needed to ensure homebuyers are not locked out of the market.

Download the plan here Fix Housing Affordability

Shaping thriving cities for our future

Most Australians live in cities, big or small. In fact, Australia is one of the most urbanised countries in the world and our cities generate more than 80 percent of our economy.

Our big cities are growing, with more than three quarters of Australia’s future population growth expected to occur in just four cities (Sydney, Melbourne, Brisbane and Perth).

So it is vital that governments get ahead of the game to make our cities more liveable and prosperous, even as they grow.

All our cities need a clear plan for their future, a pipeline of economic and social infrastructure to support them, and a focus on their long-term needs from governments.

Every level of government has responsibilities here. Local councils must facilitate the housing, commercial areas and community infrastructure we need. States and territories must set strategies, deliver infrastructure, and make planning efficient and fair. And the Commonwealth must support major infrastructure and invest in a way that makes our cities better.

That’s why we also need a new ‘compact’ that binds governments at the state, territory and federal levels to work together and improve liveability and productivity.

City Deals are a solution to this challenge – and we should have one in place for all major capital cities by 2019, as well as some of our largest regional centres.

City Deals are premised on a simple concept – and a proven model in the UK.

They see governments commit to a suite of targets, investments and policy reforms that can underpin good growth and drive economic outcomes.

They enable governments to make better choices about how and where they direct infrastructure spending, as it is tied to pre-agreed priorities.

City Deals also include incentives for improvements to housing supply and planning systems so they can deliver on the predicted growth.

Infrastructure to keep our cities moving

Infrastructure is the lifeblood of our cities.

Good transport connects people to where they live, work and play – and essential social infrastructure like schools and hospitals gives people the services they deserve.

That’s why need to reinforce the need for governments to look over the horizon and better plan, fund and deliver the infrastructure our cities need.

Setting and sticking to clear, evidence-based infrastructure priorities identified by Infrastructure Australia can remove the political risk attached to projects being announced, but then deferred or cancelled.

A range of solutions exist to fast track the delivery of much-needed infrastructuree:

• Ensuring the states have transport and social infrastructure hardwired into the strategic plans for capital cities – including funding solutions.
• Ensuring strong independent infrastructure bodies exist in all jurisdictions to create apolitical and long-term infrastructure plans.
• Bringing forward the allocated infrastructure spending for the National Urban Rail from 10 years to 5 years, with a focus on partnering with state and territory governments to deliver urban rail projects in all our major cities.
• Ensuring infrastructure markets are structured to support private sector investment, so public money can be channelled to where we need it most.
• Establishing effective corridor protection now to pave the way for future infrastructure projects.
• Re-establishing the asset recycling program, which can free up funds from surplus government assets to fund infrastructure.
• Creating a framework for trialling Tax Increment Financing (TIF) – a method of funding commonly used in the UK and US. TIF involves governments issuing bonds to pay for infrastructure and recapitalising them through the tax revenues arising from the economic growth that follows. TIF enforces a discipline on governments to make integrated decisions around infrastructure and land use, and the timely provision of infrastructure.

Leading the world 

For seven years running Australia’s largest property companies have led the world in environmental, social and governance performance on sustainability.

GRESB, the global real estate sustainability benchmark, assessed 850 real estate companies and funds around the world, representing more than 77,000 properties and $4.6 trillion in global assets under management.

The score for Australia and New Zealand has consistently beaten their global peers – but the rest of the world is beginning to catch up.

That’s why Australia’s property industry has called for measures to improve energy efficiency and encourage distributed energy within the built environment. It would also add to any whole-of-economy response to the need for greenhouse gas emissions abatement. 

In order to achieve this, five key policies are needed: 

• An ambitious national plan towards net zero emissions buildings by 2050 with staged targets for emissions and energy that will help Australia meet our obligations under the Paris Agreement
• Reforms to our energy market to support and incentivise the broader uptake of cost effective energy efficiency and distributed energy such as rooftop solar
• Strengthened and harmonised white certificate schemes across Australia with a trajectory towards a single national scheme, enabling building owners to trade their demonstrated reductions in energy consumption
• Targeted incentives for buildings that invest in energy efficiency and clean energy such as accelerated depreciation, planning incentives, stamp duty concessions and differential rates
• Modernisation of the National Construction Code with higher energy efficiency standards and a trajectory for future increases.

Making taxes fairer

A more efficient tax system will make housing more affordable, create jobs and provide a more reliable revenue base for governments.

Property is highly taxed and subject to some of the country’s worst taxes such as stamp duty.  Excess taxation makes homes less affordable and adds to the cost of doing business.

Stamp duties, land taxes, GST and large development levies can make up as much as 26 per cent of the total cost of a finished house, and up to 21 per cent of the total cost of a finished apartment.

A fairer and more efficient tax system can be achieved by:

1. Reducing stamp duty – which is recognised as one of the economy’s most inefficient taxes
2. Reshaping land tax to make it fairer by having a single flat rate land tax structure for all existing land tax payers
3. Shifting away from ad-hoc and inequitable infrastructure taxes baked into the cost of housing
4. Maintaining negative gearing and make a small change to the CGT discount, reducing it to40 percent
5. Avoiding value capture models that simply introduce new property taxes
6. Improving Australia’s ability to capture international investment by removing excessive taxes on foreign capital