rehctub:

It is not necessary to debate whether development delays are caused by governments or by developers, because in each case the solution is the same.

To the extent that the delay is caused by governments concerned about the cost of the infrastructure headworks required by the new development, the solution is to finance the infrastructure out of the uplift caused by the headworks and by permission to develop, but in such a way as to guarantee that the clawback cannot exceed the uplift and therefore cannot make an otherwise viable development unviable. A holding charge on the value of the land fits the bill. (So does a capital gains tax with appropriate deductions -- just as a matter of curiosity.)

To the extent that the delay is caused by governments afraid of NIMBYists, the solution is to buy off the NIMBYists by promising uplifts in land values due to infrastructure. But again this requires a viable method of financing the infrastructure.

To the extent that delay is caused by developers, a holding charge on the value of the land pressures the developers to get on with it. Of course it also helps to cut taxes on the developers' inputs (payroll tax, conveyancing stamp duty, insurance taxes) and taxes on the value added by their actual development (GST, company tax). But it doesn't help to cut public charges on the locational value of the land, or on any uplifts in the location value, because these things (with rare and accidental exceptions) are not the developers' doing.

Objections to land-value capture typically take the form "If you want to encourage X, you have to cut taxes on Y," and hope you won't notice that X does not follow from Y.

Peterson,
While I feel sorry for your kids situation, I invite you to simply visit your local pubs/clubs etc on any weekend and you will soon see why many gen-Y's can't afford their own home as they live for thier weekends and piss most of their money away.

I know, I have two of them myself.

Perhaps as parents we should explain to them that you can only spend a dollar once and, chances are that the huge wages many of them earn today, may well be but a 'pipe dream' tomorrow.

Sure, houses are much higher today than in years gone past, but so to are wages and borrowing conditions, until recently, have been somewhat easy compared to the 80's.

Most can afford a home, they simply choose not to go without many things. Remember, wants verses needs!