Housing supply

Concerns over housing shortage

A housing body has raised housing affordability concerns in NSW after data showed a drop in the number of new homes being built in Sydney in 2020-21.

The Property Council of Australia has called for greater action on housing supply after the New South Wales government released data showing a decline in supply in the 2020-21 financial year.

The latest Metro Housing Monitor data released by the NSW Department of Planning, Industry and the Environment revealed that 29,785 new homes were built in Sydney in the financial year 20-21.

This represents an 8% decrease from the 32,464 homes completed in FY19-20, and was lower than the 42,414 homes completed in FY18-19 and the 30,190 homes completed in FY19-20. FY15-16.

As such, NSW Property Council executive director Luke Achterstraat said the recent figures demonstrated why Australians had raised concerns about housing affordability and supply.

He mentioned the NSW Intergenerational Report 2021-22 – who said the state would need 42,000 homes built per year – and said that with an existing undersupply of nearly 50,000 homes across the state, a delay of 12,000 more homes or more would put the state in a “desperate situation” and stressed the need for positive solutions.

Mr Achterstraat said: “Without immediate action, aspiring homeowners and tenants will face continued and growing housing affordability issues. Year after year more Australians are giving up on their dream of owning a home and it’s time for that to change.

“These figures are another warning that a failure to address housing supply and affordability issues will leave a multi-generational impact on those seeking to enter the housing market. Failure to address the housing supply problem will only aggravate long-term housing affordability issues.

the NSW Intergenerational Report projected that NSW will need to build one new home for every two that currently exist over the next 40 years, and that 1.7 million homes will be needed by 2060-61 to support population growth of around 40% to 11, 5 million people.

DISCOVER

He suggested that increasing housing supply and scrap tax are two ways to tackle the housing affordability crisis.

Mr Achterstraat said the Property Council of Australia/ANZ survey repeatedly showed that housing supply and affordability were the main issues the property industry believed state governments should focus on.

He said, “As we emerge from the immediate health challenges of the pandemic, priority and attention must be focused on how the real estate sector can lead the state’s economic recovery through the provision of a supply increased housing.

“Now is not the time to be complacent, we need to act urgently and relaunch our focus on housing supply if we are to avoid stifling the next generation from home ownership.”

Concerns about housing affordability are increasingly front and center, with recent data from CoreLogic showing that home values ​​have risen at the fastest rate over the past year since 2004 (although the level growth has started to slow down).

As such, a parliamentary committee has begun soliciting submissions for a new inquiry into housing affordability and supply. The survey will examine the impact of tax and regulatory regimes on the prices, affordability and supply of housing in Australia now and in the future.

The REA group recently addressed housing affordability issues in its submission to the House of Representatives Standing Committee on the Taxation and Revenue Inquiry into Housing Affordability and Supply, suggesting that increasing housing supply is a key factor in managing rising house prices.

However, he warned that due to the considerable delay in construction, this is a medium to long term solution.

The submission also argued that state and local governments could reduce the complexity of planning requirements.

Moreover, like the NSW Intergenerational Reportthe REA group also argued that stamp duty reform would also help tackle housing affordability, calling it “an ineffective tax that slows down the property market”.

For more on property trends in Australia, watch the October edition of The Adviser.

[Related: Broking sector unpacks macro policy impact on property]

Concerns over housing shortage




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Last update: March 09, 2022

Posted: September 28, 2021




Malavika Santhebennur

Malavika Santhebennur

AUTHOR

Malavika Santhebennur is the Mortgage Headlines Editor at Momentum Media.