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The Forum > Article Comments > Out of touch, lost the plot and just plain dangerous > Comments

Out of touch, lost the plot and just plain dangerous : Comments

By Ross Elliott, published 6/7/2012

Housing affordability is a chronic problem for a generation of young Australians. One third of the price of new homes is now tax and regulation.

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Of course housing affordability is an issue and must be addressed, but not at the expense of paving over the entire countryside. What is at issue here is unsustainable population growth with Melbourne growing by nearly 70,000 a year. 35,000 new houses? Great, that will accommodate about 18 months worth of population growth, assuming three people per household, and that's a bit more than average household size. So if we release 35,000 new house sites every 18 months, before long you will have paved over all the arable land within coo-ee of Melbourne. And if you're living 100 kms out, how do you get to work once oil prices start their inexorable rise in three years time? It's time we recognised limits and stabilised our population numbers before we pave over every green wedge and market garden in the immediate region.
Posted by popnperish, Friday, 6 July 2012 9:18:56 AM
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The choice is not between urban sprawl and higher density. It is between growth in the capital and growth in provincial cities. The UK has only 12.5 per cent of its population in London. Victoria has more than 70 per cent of its in Melbourne.

The Baillieu government hasn’t got a clue. It is treating green wedge land as if it is no more than future urban land waiting in a queue.

The Board of Works established Melbourne’s urban growth boundary 40 years ago when it set up the green wedges and development corridors for the metropolitan area. The original review took five years, beginning with Dick Hamer’s letter of 3 May, 1966, including a comprehensive assessment of environmental, economic and social needs and culminating in the release of Planning Policies for the Melbourne Metropolitan Region on 29 November, 1971, by the Board of Works.

The green wedges were meant to be permanent. As the Liberal Party itself said 42 years ago, ‘We believe that any future growth of the metropolis should be of a “corridor” pattern, and that “green wedges” of open space, parkland and recreation areas should be permanently preserved between such corridors, especially along the river valleys, readily accessible to all.’ (‘Architects challenge party leaders’, The Age, 23/5/1970).

The Board of Works subsequently set aside 2,670 square kilometres for green wedges and 2,359 square kilometres as urban land. Mr J. A. Hepburn, the chief planner for the Board of Works, said, ‘All future development will be in corridors…. There will be no urban development in the green wedges – that is the basis of the whole policy.’ (‘Nature-lovers must feel happy’, 30/11/1971, The Sun).

Instead of ‘permanently’ and ‘no urban development’ we are to have large chunks slashed out for asphalt and concrete every two years. The Baillieu government is destroying Dick Hamer’s legacy. Melbourne’s planning history us at http://melbourneurbanist.wordpress.com/2010/10/20/what-should-we-do-about-melbourne/.
Posted by Chris C, Friday, 6 July 2012 9:27:38 AM
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If all these planners were worth having, instead of trying to dictate how others must live, to suit some ivory tower dream, they would be organising our cities, & regions to suit how the population want to live.

It becomes more obvious every day, that these elites are not working for the good of the community, but for the good of the elites. They are not interested in trying to provide what people want, just in herding the population out of their way, at least cost in effort.

We spent squillions a few decades back, when the current fad of planners was decentralisation. Albury/Wodonga & Orange were a couple chosen by these twits, & look at them now. Meanwhile other places have grown greatly, when there was some reason for them to grow.

Well now is the chance. People are voting with their feet. Develop business, industry & government employment where people want to live & you've got decentralisation done for you.

I guess it's too simple for academics.
Posted by Hasbeen, Friday, 6 July 2012 10:48:47 AM
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Mr Elliott quotes a sentence from Prof Buxton and goes on to say
"The brilliant Professor Buxton's slim grasp on household economics 101 is a bit of a worry"

Mr Elliott doesn't quote any more of Prof Buxton's article but I think it's a pretty good guess that it goes on to make it clear that it refers to the total costs to the community, not just the costs to the individual home buyer.

And if Mr Elliott doesn't understand the remainder of Prof Buxton's article, why doesn't he quote the rest of it so that we may see for ourselves?

How can a person be so dim-witted as to read an article by a Professor, think it means something which is completely idiotic, and not realise that, just possibly, he has missed the point?
Posted by jeremy, Friday, 6 July 2012 11:04:43 AM
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Various govts have attacked housing affordability, with tax charges and patently puerile policy paradigms that forced the price of basic housing up.
They also forced the price of housing up by rationing the release of rezoned urban land.
Further compounded the problem with regressive tax measures that simply cascaded and added exponentially to the cost.
They then exacerbated the problem by increasing emigration well beyond the capacity of infrastructure and or roll out to cope.
Then they allowed green advocates to further compound the problems, by adopting green density housing paradigms, all while ignoring the fact that city dwellers produce 2.5 times the Co2 emission of their country cousins.
Fortunately, we now have the NBN roll out, which will assist in decentralisation and or developing the regions, and returning housing affordability.
Finally, very rapid rail would allow the decentralisation so badly needed for now numerous reason, to proceed.
Look, smart govts would resume land for very rapid rail corridors. Then rezone some of that land as new urban.
Underground systems would often be cheaper than resuming land in already densely developed areas.
As the rail projects rolled out, lands sales would all but pay for the rail roll out.
Punitive capital gains tax on all undeveloped recently rezoned urban land would prevent speculators and land banking barons from limiting progressive progress back to housing affordability.
Land tax on all undeveloped urban land, would fund the needed infrastructure roll outs, as would repealing negative gearing, which is removing over 5 billion PA from revenue.
Certainly, we shouldn't simply pave over our most arable land, which by the way also just happens to be coastal and or, flood plains.
While we are at it, instead of power lines that can be blown or burnt down, we should instead pipe NG to the new developments, and use individual ceramic fuel cells to provide power.
Some of the NG could also be supplemented by biogas produced onsite, by digested waste. Much better than sending it to landfill or primitive sewage treatment plants, which simply send methane skywards, where it further compounds global warming!
Rhrosty.
Posted by Rhrosty, Friday, 6 July 2012 11:37:30 AM
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I live in Albury-Wodonga and absoluely love it. Building a new house too which i could afford on a 700sq metre block.
Posted by Chris Lewis, Friday, 6 July 2012 2:06:03 PM
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I live in Western Australia and we have a similar problem to Victoria. I agree with Ross, the politicians bleat about the urban sprawl and the Greens bleat about the loss of countryside to housing, in the meantime housing prices rise and young people see the affordability of owning a house gradually rising beyond their reach.
State governments should develop this outer urban greenfield land at cost.
During development light rail transport and community facilities should be built.
These developed outer urban housing site should then be offered to first home buyers at cost with the proviso that a certain type of house be built within a specified period.
Engineering companies be encouraged to factory produce steel or pine framed housing on a production line basis. A complete house can be assembled in the factory in this way including costly onsite services and transported to the site dismantled, then re-erected in a very short time on a prepared concrete slab.
This type of housing is usually manufactured and erected by semi-skilled labour thus further reducing the initial cost.
Already these relatively cheap manufactured houses are being constructed in European countries such as Sweden. The houses consist of a number of basic designs depending upon individual choice and affordability, being of a very good standard and finish, are eminently suitable for first home buyers on a limited financial budget.
There is nothing wrong with outer urban housing provided all modern amenities are initially provided together with very importantly cheap efficient light rail public transport.
Usually when these projects are provided by private developers they have to overcome/meet all sorts of costs and obstacles provided by State and Local Governments resulting in added costs to the buyer without any advantage of cheap efficient public transport or community facilities initially provided, hence the criticism against outer urban living by these aforementioned idealists.
One must feel for the young people today who can only look forward to a huge debt burden if they desire to own their own home? Who does'nt?
Posted by Jack from Bicton, Friday, 6 July 2012 2:45:33 PM
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One thing that must be considered in the 'affordable housing' debate is that real estate is often the biggest investment in a person's life. I recently bought my first home and am in that precarious place where a drop in property values would mean that I have borrowed more than I own. Sadly, to make housing more affordable by simply reducing house prices, we are chipping away at the investments of those who already own houses. Once again, we are robbing the 'rich' (as the federal government now classifies me) to give to the poor.

Are there more innovative solutions out there? Decentralisation always pops up, as noted by Hasbeen. I can buy a house an hour and a bit west of here, in Charters Towers, that is much bigger than my own for about $100,000 less than I have spent. The trouble is, there's not much for me to do there in terms of work. Perhaps making affordable places more liveable would be a start - don't just tell people to 'go bush' - work on the sustainability of rural/regional communities so that they become places to raise a family - and places where the kids just might stay when they grow up. I'm not a planner, and I don't know how this would be achieved, but I am sure there are ways to please the home owners AND the home seekers at the same time.
Posted by Otokonoko, Friday, 6 July 2012 3:30:05 PM
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Sorry Ross but based on the 2011 census, the glory days of the housing sector are over.

The government funded National Housing Supply Council (NHSC) tried to talk up the so-called housing shortage by stating:

“The revised national estimate of the housing shortfall at the end-June 2010 is 200,000 dwellings, 13,000 greater than previously published”

A good try but reporting on the census Bloomberg News revealed:

“Australia has almost 1 million fewer households than assumed in a government forecast of a housing shortage, raising doubts about a supply shortfall cited as the main reason the nation will avoid a US style housing crash”

And

“The nation had 7.8m households, compared with estimates of 8.7 as of June 2010 as used by the NHSC and additionally our nations population grew by 300,000 less than previously estimated.”

So Ross, there are now 300,000 fewer people in Australia than previously thought, roughly equal to one year's immigration levels.

Our entire banking sector is built on a fallacy, the banks, in cahoots with the housing industry and government have built a housing bubble on the false belief that the Australian population was soaring.

Ergo, Australia has a gigantic asset and credit bubble, get ready for the housing and banking bust.

somehow I don’t think NSW and Victoria will need that land they have set aside for release!
Posted by Geoff of Perth, Friday, 6 July 2012 3:31:08 PM
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Chris I agree Albury-Wodonga is a lovely place, just a damn fool place to try to develop into a major manufacturing hub. Still having spent my later school years in Bathurst & Young, & my flying training at Uranquinty, [Wagga Wagga for most of you], I guess you are wishing for some global warming right now.

Rhrosty I agree with much of your post, except the transport bit. It makes no sense at all to continue bringing office workers into any city day after day. The sensible thing is to take the work to the people. Move all those public servants work sites out to the periphery of the cities, & much of the rest will follow. We might as well make some use of this fool NBN.

This way you don't need new expanded railways or new freeways, & you have much better life styles for all.
Posted by Hasbeen, Friday, 6 July 2012 11:46:32 PM
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Ross Elliot writes:

< In Victoria, the state government has announced the release of an additional 35,000 lots around the Melbourne fringe, to stimulate the supply and choice of new housing and to reduce price pressure from limited supply. >

What this is doing is chasing the tail of the huge and ever-rapidly-increasing demand for housing that is being exerted via our absurdly high immigration rate.

Ross Elliot concedes that supply is a factor in housing affordability. That’s a start. So can he now concede that it is not just supply, but it is the relationship between supply and demand, in which the demand factor is the all-important element?

By far the easiest and most effective single measure to increase housing affordability would be a simple large reduction in immigration.

But of course, we’d then have Ross and his ilk crying foul very loud and long at the downturn in the property market, both in the number of sales and the profit margin in the real estate business!

< What's been proposed in NSW and Victoria is nothing more than a fresh look at stimulating new home construction…. >

YES! Nothing more than that.

It is certainly NOT a holistic approach to the issue. Stimulating home construction would be part of the solution if it was coupled with a much more sensible approach to the demand side of the equation. In the absence of this, it will at best provide only very limited and temporary relief to high house prices.
Posted by Ludwig, Saturday, 7 July 2012 10:17:48 AM
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I don't have enough knowledge to contribute to solutions. I will never understand suburban living though, 'tis soul destroying (I enjoy apartment living in inner city and rural living) but understand others love it and the libertarian in me supports their right to choose.

I think eventually the suburban sprawl model will possibly collapse, as there seem little forethought in the infrastructure to post peak cheap oil. Though if a majority move to scooters in the interim when petrol sits at >$5 equivalent a litre, congestion will minimise. Perhaps an inevitable switch to electric vehicles, albeit that has inherent infrastructure issues as we seem keen to continue baseload models of electricity generation. Of course charging everyones Car at midnight is a good use of offpeak, as the Smelters are closing down. Government seems to never want to build a decent heavy rail spoke with light rail transport infrastructure. Poor utilisation of tax dollars on non-recurrent expenditure vs infrastructure spending seems the culprit there, coupled with the inevitable inherent incompetence of managing complex system with central planning.

As to population, it will only ever expand in Aus, if the climate guys are right, there will be lots of climate immigration we won't be able to control, short of standing at the beach and riddling them "Normandy Invasion" style.

We also seem a stand-out in our "everyone live in the capital city" model (and then everyone leave on the weekend to swamp nearby tourist villages) but I guess that's a function of our highly productive primary resource sector and everyone else living in the city engaged in washing each others dogs, not having a diverse economy.
Posted by Valley Guy, Saturday, 14 July 2012 5:44:24 PM
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