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Home buyers might be searching yet, as housing stock still short. Image – Canva.
  • REIA called for long-term planning
  • Rezoning reform, red tape reduction and other issues still not addressed
  • Increased housing could mean land shortages worsen

The Real Estate Institute of Australia (REIA) is urging the Federal and State Governments to improve planning approval times in a bid to address the diminishing housing supply.

It won’t be the first time this year, nor this pandemic that an industry body has either called for a reduction of red tape or increased housing supply.

So far this year

In February, research conducted by the University of New South Wales (UNSW) and the Australian Council of Social Service’s Poverty and Inequality, called for increased social housing.

At a recent Property Council event, social housing was noted as the cornerstone of any successful policy to end homelessness, called a housing first policy.

NAB CEO Ross McEwan urged state governments to speed up the development of land for residential construction to increase supply and cool house prices in late April, the House of Representatives Standing Committee on Economics heard umpteen calls to cut red tape.

Later in June, Australia got a slap on the wrist by the Organisation for Economic Co-operation and Development (OECD). A report by the international organisation noted restrictive regulations in the housing market was a key reason why supply has failed to keep up with demand – even before the pandemic.

Australia was also chided domestically, the Grattan Institute’s Housing Affordability Report found that “over much of the last two decades, constraints have limited new supply that would normally respond to higher demand. Planning rules that restrict the construction of more homes in inner and middle-ring suburbs have dragged on development.”

REIA calls for long-term planning

REIA President Adrian Kelly said there needs to be a long-term and collaborative industry-government plan for housing.

“The changes should involve reducing the cost of the development application process, rezoning reform, improving approval times for development applications, introduction of land release programs and the establishment of a government-led mechanism for reliable data on housing demand and supply,” said Mr Kelly.

Issues aren’t helped either by the politicisation of the housing industry, Mr Kelly said it became a bipolar battle of “… public versus private, State versus Federal, young versus old, wealthy versus poor and civil society versus business groups,”.

More issues abound?

The Property Tribune reported earlier this month that increased housing could worsen the land shortage in WA.

Then only covering WA, The Property Tribune confirmed with Urban Development Institute of Australia (UDIA) National President Simon Basheer that the issue wasn’t isolated.

“There’s no doubt land supply pipelines are starting to thin across our capital cities,” Mr Basheer said, the housing grants made available during the pandemic “triggered a wave of home buyers coming into the market and pulling forward demand, particularly across greenfield land release areas.”

UDIA National’s State of the Land – 2021 report found that national residential annual lot releases increased by an average of 47% in 2020, with a total of 54,860 lots released across capital city markets.

Mr Basheer noted in particular that, “by the December 2020 quarter, the national greenfield lot clearance rate was 105%, with sales exceeding releases (taking into account carry-in unsold stock into the quarter).”

Like other industry bodies across the property sector, Mr Basheer has also called on governments to increase housing supply and affordability, and take away restrictions choking supply.

“A focus on quicker rezonings, reduced red and green tape, better planning and funding of trunk infrastructure and more efficient taxation. Until we produce a strong and sustainable level of land release and supply, we risk adding to the affordability woes facing homebuyers.” he said.

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