Family First talks housing sense

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ScreenHunter_23 Aug. 27 15.54

By Leith van Onselen

Sometimes, it’s the fringe parties that make the most sense. Earlier this year, Bob Katter spoke out about what is required to achieve affordable housing in Australia’s mining towns: freeing-up land supply:

UNDER a radical new scheme, Federal Member for Kennedy, Bob Katter, claims he can reduce the cost of house blocks in mining towns to as little as $25,000 and put an immediate halt to sky-rocketing rents and house prices in Queensland’s resource-rich areas.

The average house block in the Central Queensland mining town, Emerald, currently costs around $168,000…

Explaining how the affordable housing scheme would work, Katter said, “We open up the land,”

“… the price of land has got nothing to do with anything else except the restrictions placed upon land subdivisions by government. Remove those restrictions and I can give you housing prices that you can only dream of.”

“We sold land in 1990 in Charters Towers for $6000 a block, and any time the price went over $6000 we’d just dump another 20 or 30 blocks on to the market.

“When that power was taken away from the local Mines Department, that price shot up to $126,000 for a housing block in Charters Towers.”

Under his scheme Katter says a block of land would cost around $25,000 to $30,000 and subdivisions would be born virtually overnight with the use of prefabricated homes. The required infrastructure such as extension of water supply, sewerage and road systems would be supplemented in part from the 20 per cent return from the Royalties for Regions scheme…

“The really big contributing factor is greenies, and the town planners, the local blue heeler dog, they all get in the act. By the time they’ve all had their hit at you, you’re looking at retirement.

“It goes on for years and years by the time you please all the government instrumentalities.”

“…we will give to you the cheapest housing available in the world…”

Now, the Family First party has articulated a similarly sensible plan in its housing policy statement:

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To fix the [housing affordability] problem for good and ensure that future generations do not suffer the same fate, Family First proposes five key policy initiatives:

1) Where they have been applied, urban growth boundaries or zoning restrictions on the urban fringes of our cities need to be removed. Residential development on the urban fringe needs to be made a “permitted use.” In other words, there should be no zoning restrictions in turning rural fringe land into residential land.

2) Small players need to be encouraged back into the market by abolishing compulsory ‘Master Planning.’ If large developers wish to initiate Master Planned Communities, that’s fine, but don’t make them compulsory.

3) Allow the development of basic serviced allotments ie water, sewer, electricity, stormwater, bitumen road, street lighting and street signage. Additional services and amenities (lakes, entrance walls, childcare centres, bike trails, etc can be optional extras if the developer wishes to provide them and the buyers are willing to pay for them).

4) Privatise planning approvals. Any qualified Town Planner should be able to certify that a development application complies with a Local Government’s Development Plan.

5) No up-front infrastructure charges. All services should be allowed to be paid for through the rates system ie pay ‘as’ you use , not ‘before’ you use.

Given the vast social and economic benefits that flow from homeownership, Family First believes restoring housing affordability should once again become one of our nation’s most important priorities.

Wow. I couldn’t have articulated the required supply-reforms better myself. Throw in winding-back negative gearing and the removal of stamp duties in favour of a broad-based land tax, and their housing policy would be complete.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.