At a Brisbane meeting yesterday focused on social and affordable housing, National Cabinet agreed to a target of 1.2 million new homes over five years – 200,000 more than last year’s National Accord Housing Target.
ACT Chief Minister Andrew Barr, who attended the meeting, said: “The objective is simple: more housing for Canberrans, where they want to live.”
The Business Council of Australia welcomed the initiative. But neither the Canberra Liberals, the Federal Greens, nor advocacy group Better Renting are convinced.
The new housing target will begin next July, Prime Minister Anthony Albanese announced. As an incentive, the Federal Government will provide $3 billion in performance-based funding (the New Home Bonus) for states and territories that build more than their allocated amount.
A $500 million competitive housing support fund, the Housing Support Program, will encourage local and state governments to ‘kick-start’ housing supply through targeted payments for connecting essential services, amenities to support new housing development, or building planning capability.
The initiative will be supported by reforms to rent and to planning and zoning.
Mr Barr said the ACT Government welcomed the $3.5 billion investment.
“We were already planning to deliver our per capita share of the 1 million homes target and will continue to pursue this necessary objective as one of the fastest growing jurisdictions in the country,” Mr Barr said.
“Once applications are open for the Housing Support Program, we will be ready to submit a range of project proposals to further accelerate the delivery of more new homes.”
The Business Council of Australia said business strongly backed the cabinet decisions.
“We agree there is an urgent need to fix planning systems that are restricting new housing supply and welcome the National Cabinet’s focus on this,” CEO Jennifer Westacott said.
“The Prime Minister is absolutely correct when he says, ‘supply is key’. Business applauds the Albanese Government for putting $3 billion on the table to incentivise the states and territories to make this happen.
“We also welcome funding to support infrastructure that facilitates housing delivery, which will also be critical in getting more housing built.”
But Canberra Liberals MLA Mark Parton, ACT shadow minister for housing and homelessness, was dubious.
“Our biggest problem is supply, and it’s positive that both levels of government are at least talking about supply, but I’m hearing a lot of talking about new dwellings, but not much action,” he said.
“It’s truly bizarre that as we talk about these moves to escalate supply, we’re considering a draft bill from a government member [Greens MLA Johnathan Davis] for a two-year rent freeze, a measure which all of the science shows would diminish supply and create more homelessness.
“My question is: who’s actually going to build all of these homes? One of the many reasons that the government gives for not meeting its public housing growth and renewal program is a construction sector skills shortage, so how are we going to find the physical workers to build these homes?
“And who’s going to buy them? With investors being spooked out of the market by the absurd rental reforms being spruiked by the Greens and interest rates sitting at a decade high, who will be borrowing to buy these homes, should they be built?”
Likewise, federal Greens leader Adam Bandt MP said Labor had not spent enough to address the public housing shortfall; he called on Mr Albanese to use a $20 billion surplus to deliver more.
“It seems like the Prime Minister has announced $3 billion to build penthouse apartments no one can afford, when they should just be spending an extra $3 billion on public and affordable housing,” Greens housing and homelessness spokesperson Max Chandler-Mather MP said.
“Labor can talk about supply all they want, but expensive private apartments won’t fix the housing crisis. What we desperately need is billions of dollars of investment in public housing every year.”
Earlier this week, Anglicare noted that there was an oversupply of dwellings, compared to needs and demographics, but a shortage of social and affordable homes.
Between 165,000 and 240,000 new dwellings are built across Australia each year, Anglicare stated, but only 3,000 social homes; Anglicare believes that 15,000 new social homes must be built every year across the country.
Over the past four decades, it stated, housing had been privatised and social housing stocks had dwindled, as the federal government spent more on schemes that incentivised the private market (negative gearing tax breaks and rent assistance payments) and less on social housing.
Rental reforms
Cabinet also agreed to rental reforms, A Better Deal for Renters, including limiting rent increases to once per year; implementing minimum rental standards; developing a nationwide policy to require genuine reasonable grounds for evictions; banning rent bidding; allowing people experiencing family or domestic violence to end a tenancy agreement without penalty; and putting in place a maximum break-lease fee.
The ACT Government would implement the full tenancy protections outlined in the Better Deal for Renters, Mr Barr said. It would expand the Rent Relief Fund, set up in April.
“No-fault eviction protections, minimum standards for rental properties, and preventing excessive rent increases are established protections in the ACT,” Mr Barr said.
“Increased supply combined with appropriate prescribed rent caps and no-cause eviction protections – as currently formulated in the ACT – strike the balance of ensuring property maintenance, encouraging further investment and avoiding excessive rent increases.”
But both the Federal Greens and advocacy group Better Renting considered the rental reforms inadequate. Rental increases were already limited to once per year in every state and territory except the Northern Territory, the Greens noted; and the cabinet had not adopted the ACT’s model of limiting the amount of rental increases.
“This is a smoke and mirrors announcement designed to make it look like Labor has done something meaningful for renters, when in fact they have basically enshrined the status quo, leaving renters exposed to astronomical rent increases once a year,” Max Chandler-Mather said.
Instead, there had been no agreement to end no-cause evictions; “disgracefully low” minimum standards (“including no clear timeline for when renters can demand even cold running water”); and no cap on rent increases. Meanwhile, property investors would get $39 billion in tax concessions this year.
“Renters have been served up reheated leftovers as if it’s a banquet, but we are tired of eating the scraps from the master’s table,” Joel Dignam, executive director of Better Renting, said.
“The commitment to limit the frequency of rent increases is hollow: about 90 per cent of renters already have 12-monthly rent increases, and the real issue is the size of rent increases, not just the frequency. Without limits on rent increases, reducing the frequency could actually make things worse. Jurisdictions should look to build upon the model in the ACT and require landlords to obtain Tribunal sign-off for rent increases above a certain threshold.
“The vague talk around evictions is just smoke and mirrors unless governments act soon and end no-grounds evictions for both periodic and fixed-term tenancies. Ending a tenancy and forcing someone out of their home is a big deal – a decent reason should always be required, whether it’s a periodic or fixed-term tenancy.
“There’s an old Woody Allen joke about two women eating out and one of them says: ‘The food here is really terrible.’ The other replies: ‘Yeah, I know, and such small portions.’ That is what National Cabinet is offering today: a terrible offering, and very little of it.”
But Mr Albanese said the Greens were standing in the way of new social and affordable housing.
“This is an initiative that shows how serious we are as state and territory governments across the political spectrum as well as the Commonwealth, understanding that supply is the key.
“You cannot say you support increased housing supply and vote against the Housing Australia Future Fund.”
The Fund is a $10 billion Federal Labor proposal to build 30,000 new social and affordable housing properties in five years. The debate was postponed from June to October because the Greens wanted more funding for public and affordable housing and more support for renters.
Mr Albanese said moving towards nationally consistent laws would make it easier for renters.
Zoning reforms
The cabinet also agreed to a National Planning Reform Blueprint, improving housing supply and affordability through planning, zoning, land release and other measures – “a crucial component of increasing housing supply and housing choice”, Mr Barr said. Medium and high-density housing would be promoted in areas close to public transport, while approval pathways would be streamlined.
“The ACT is well placed to implement the National Cabinet agreed reforms to increase housing supply and improve housing choice, access, and affordability,” the Chief Minister said.
The residential zoning changes that will be implemented as part of the Planning System Review and Reform Project, which passed the Legislative Assembly in June, “will provide more medium density housing choices in existing Canberra suburbs through a long-term program of gentle urbanism,” he said. “New housing will be built close to transport, to public services, to economic opportunities.”
The ACT Government’s land release program has identified greenfield and infill sites with capacity for more than 16,000 new dwellings.
“The planning and zoning changes above are critical to achieving these urban infill objectives,” Mr Barr said.
The ACT Government will release the new planning documents with these proposed zoning changes shortly.
ACT Government: Housing
The Chief Minister continued: “We are already increasing housing supply across the board with a range of new initiatives designed to increase choice, access and affordability.”
In the 2023-24 Budget, the ACT Government announced a $345 million package of housing measures, including a $60 million Affordable Housing Project Fund to grow the number of affordable rental options available at less than market rent.
The government has reduced stamp duty (a tax people pay when they buy property in the ACT) in every Budget since 2012. This initiative, targeted at the lowest thresholds for owner-occupiers (people who buy properties to live in), encourages home-buyers, rather than people who buy investment properties to rent out.
“During Stage 3 of tax reform, we have split the duty payable to identify investors from owner-occupiers, prioritising duty reductions for owner-occupiers to support more people buying a home for them to live in,” Mr Barr said.
In addition, the ACT Government offers the Home Buyer Concession Scheme, which removes or reduces duty on properties, and eligible off-the-plan purchases that can fully exempt stamp duty.
The government also invested an additional $236 million for Housing ACT to more and improved public housing.
Property owners who rent their property through a registered community housing provider for affordable community housing purposes can get the Affordable Community Housing Land Tax Exemption; this exemption is available for up to 250 ACT properties. Likewise, lease holders who vary their lease to enable new or additional development can get Lease Variation Charge discounts for affordable rental projects.
With AAP
