25 October 2024 

In this Edition...

1.STOP PRESS - NSW Government REJECTS Still Considering Canterbury Bankstown proposal for two extra State led Tier 1 TOD accelerated precincts  

2. Victoria comes out firing with 50 TOD sites in Melbourne 

3. Dutton trumps Albanese on housing infrastructure funding and rattles the Federal Government

...and much, much more.

4. Construction Code freeze – makes Husic hot under the collar! 
5. Premier Minns considers a Planning Tsar to block housing impasse?
6. Inner West Council planning principles shows strong support for TODs
7. An Albanese housing fund, ill-conceived and ill-directed
8. Stalling commencements make Sydney the “sick man of Australia”
9. Quote of the week - Premier Jacinta Allan
10. New NSW Building Commissioner appointed
11. Feds should help give stamp duty the boot
12. Spotlight on excellence – DEA Highly Commended Awards 
13. Other news
14. Council Watch
15. Members in the news 

The Urban Taskforce has been advised that the NSW Government has not yet made a decision on whether or not to include Campsie or Canterbury stations as Tier 1 TOD Accelerated Precincts. 

We are advised that the information contained in the Bankstown Accelerated Precinct and Changes to Planning Pathways Submission was not correct.

The below story must be read in conjunction with the Stop Press above. 

1.NSW Government REJECTS Canterbury Bankstown proposal for two extra State led Tier 1 TOD accelerated precincts – WHY? 

Canterbury Bankstown Council’s submission on the Canterbury TOD precinct controls reveals that they had wanted Campsie and Canterbury stations declared as “Accelerated Precincts” – otherwise known as Tier 1 TOD accelerated precincts.

The NSW Government decided to ignore council’s pleas altogether on Campsie and low-balled Canterbury with a Tier 2 TOD declaration – offering far less flexibility for growth than the Accelerated Precinct Tier 1 TOD option.

Council understood and supported that the best way forward here on two strategic transport sites, each with new Metro station and services, was through the state led rezoning and assessment and the Tier One TOD pathway - but DPIE and the State Government apparently disagreed! 

Why?  Was the Premier consulted on this?  A downgrade in housing growth even though Council called for it?

The entire area does not need to be high rise – but the benefit of a Tier 1 TOD is DPHI can set aside the local DCPs and design a town centre and surrounding area which takes full advantage of the Metro conversion.  Council saw the logic of this, so what happened at DPHI? 

If ever there was a case for a Tier 1 TOD accelerated precinct re-zoning, Canterbury and Campsie stand out as obvious choices. 

Despite all the positive talk from the Premier, the message just hasn’t gotten through. Premier Chris Minns needs to take greater control to ensure every option for greater housing supply is progressed, and not frustrated by local political agendas. 

In this case – the logic is obvious. 

The Council is supportive. 

But, the Government said no. 

It’s time to get serious.

2. Victoria comes out firing with 50 TOD sites in Melbourne 

A big week in Victoria, with Premier Jacinta Allan laying out a number of key planning policies designed to boost housing supply and increase investor confidence in housing.

While housing completions in Victoria are already at the targets set under the National Housing Accord, this week builds on previous work and starts to lay out where well located housing will occur.

Grattan Institute modelling shows that if Victoria hits the government’s housing targets, rents could be 13% lower than they otherwise would be by 2034. Renters would save about $14 billion over the decade, and almost $3 billion in 2033-34 alone, compared with business as usual.

The centrepiece was an announcement of 50 (YES 50!!!) transport-oriented development precincts –or “activity centres” as the Victorians call them – areas within 800 metres of a station.

To be fair, NSW was ahead of the game on this with 37 Tier 2 TODS and 7 Tier 1 "Accelerated Precincts", but they have been slow on the delivery.  We are still waiting for the finalisation of the Tier 1 precinct planning pathway and height/density details.

Further, in Victoria these “activity centres” are situated in many highly desirable and well located parts of Melbourne – suburbs like Toorak, Brighton and Malvern.

The Premier and Planning Minister announced the first 25 sites this week, with the remaining 25 to be announced by year’s end.

One area of concern is the Victorian Premier’s insistence that the TOD sites will preserve the heritage and landscape overlays. For housing to occur, there needs to be a clear planning pathway and the numbers have to stack up. Heritage should be protected and respected (or even better, enhanced) but this does not exclude increased height and density.  The whole of London is a Heritage precinct, but they manage this while massively increasing the height and density of development.

While local DCPs are set aside in NSW through the SSD planning pathway, the refusal to override local controls such as heritage TOD2 sites, is proving to be a stumbling block. It is something to watch in Victoria as well.

Combined with infill opportunities, the Victorian Government also released a plan for 27 additional greenfield areas across Melbourne’s outer south-east, north, and west to be released over the next 10 years – committing to providing the space and completing the planning work to deliver 180,000 new homes over the decade.

This was a big week: the Victorian Premier also announced the removal of current caps for stamp duty concessions over the next 12 months, allowing a 100% deduction of outstanding construction and refurbishment costs when determining how much stamp duty is owed. Under a change that will boost housing construction:

• Anyone buying an apartment, unit or townhouse off-the-plan can claim the concession – not just first home buyers and owner-occupiers
• Thresholds will be removed so the concession is available for apartments, units and townhouses of any value

As Premier Allan says, more homes mean more opportunities. The Victorian Government is certainly showing how it can be done.

3. Dutton trumps Albanese on housing infrastructure funding and rattles the Federal Government

Last week we called on the Federal Opposition to move on from simply blocking Labor housing policy (good, bad and indifferent) and start to deliver positive policies of their own.

Well this week they delivered in spades with a $5 billion housing enabling infrastructure fund to assist State and local Government deliver more housing. 

The Coalition’s new housing policy unlocks private sector investment and is much more likely to deliver many more houses.  This is the economic gap that the Albanese Government has missed.

Funding housing related infrastructure unlocks private sector investment, so the Commonwealth gets a multiplier effect from its investment. Commonwealth spending boosts private investment resulting in many more privately owned homes

Credit goes to Opposition Leader Peter Dutton and his Shadow Minister for Housing, Michael Sukkar, for listening to industry concerns and responding in this way.

Housing enabling infrastructure is a critical part of the housing supply puzzle, and greater Federal assistance in this area has been a key ask of Urban Taskforce in recent times. As CEO Tom Forrest wrote in his article welcoming the policy in the industry journal Sourceable,

The housing supply crisis is a social and economic disaster that sucks vitality from the economy, hampers productivity, damages national prosperity and exacerbates a variety of societal ills.

The Commonwealth identified the problem early in its term, but has struggled to follow through on ways of addressing the crisis

Urban Living Network, 16 December 2022

The Albanese Government has been too focussed on the 4% of the housing market which is social and affordable housing, while doing little for market housing. The ability to deliver market housing will be the making or breaking of the National Housing Accord.

Urban Taskforce has also criticised the Albanese Government’s $3 billion New Home Bonus which will only be paid out some time after June 2029 and only if a State meets their original targets. Looks like the only State that’s going to be taking home cash from this source will be Victoria!

More upfront money for roads and water from the Opposition, should they win, will unlock housing right across the nation. This is a good policy.

At the same time, the Coalition should also keep the Housing Australia Future Fund. This is not an either-or question. After the arduous path in establishing the $10 billion HAFF program, it would be tragic for it to be killed off after its first round.

4. Construction Code freeze – makes Husic hot under the collar! 

Another welcome aspect of the Coalition’s announcement this week was a commitment to freeze any changes to the National Construction Code for a decade.

Regulatory churn in construction regulation has been a critical factor adding to uncertainty and rising housing construction costs. It is why all States bar NSW sought to defer the latest round of changes to give the construction industry some breathing space.

It is far cheaper now to buy an established home built any time before 2022 than it is to buy a home off the plan.  This is because of the changes to construction standards.  This is driving down off-the-plan purchases as the costs are too high, making housing supply less feasible, thus exacerbating the housing supply crisis.

Changes to the codes push up the cost of homes.  The Labor Premier of South Australia, Peter Malinauskas, led the way by deferring all changes to NCC code application in that State for 10 years – directly in response to the affordability crisis.

The Federal Opposition’s policy prompted a panicked and OTT response from the Minister for Industry and Science, Hon Ed Husic.

The opening lines of Minister Husic’s press release are wrong and only seek to spread alarm in the community.

This is unmitigated scaremongering rubbish which from a politician who has made a career out of being a moderate and sensible voice.

Just for the kiddies at home … across Australia we already have compulsory water inundation sprinkler systems and separated fire escapes in all new apartment buildings. In Grenfell Tower in London, UK, they had no sprinklers, combustible cladding, and a “wait in place” edict in the case of fire.  To compare the two is base scare-mongering and must be called out.

Did Ed Husic’s office really write this media release?  If so, why didn’t we see this hyperbole two months ago when the South Australian Labor Government announced the same policy for South Australia?

What this shows is the Federal Opposition’s announcements this week on housing have hit a raw nerve in the Albanese Government.

5. Premier Minns considers a Planning Tsar to block housing impasse?

Would Tsar Peter the Great allowed NIMBYs to stifle his vision of St Petersburg?

Peter the Great, the Tsar of Russia from 1682 to 1721, had a vision for the development of swampland adjoining the Baltic Sea.  That site was developed and became St Petersburg, which remains one of the great cities of the world.  Tsar Peter gave NIMBYS (Not In My Back Yard Swamp) very short shrift, but his legacy is remembered.

The SMH ran a story this week noting that the NSW Premier Chris Minns was considering further planning reform to turn around the State’s pitiful performance when it comes to housing approvals, commencements and completions.

The SMH described the housing supply pipeline in NSW as “anaemic”. Fair call – housing approval figures remain disastrous.

A s the days, weeks and months pass, it is becoming increasingly unlikely that NSW will be able to get anywhere near its targets under the housing accord.

We are nearing the end of 2024 and the State Government is yet to finalise two key planning policies when it comes to housing – the TOD Tier 1 Accelerated Precincts (announced 7 December 2023) and the mid rise reforms (announced 28 November 2023).

The delay is actually making the crisis worse as applications are delayed while they wait for the new rules to be published.

There is a growing sense of frustration from the Premier.  Whenever he gets up to talking about housing, he is faced with a deteriorating set of numbers around supply. Somehow, all his good announcements require a year or longer of bureaucratic and political backsliding. Put simply, the Premier’s rhetoric is not being matched by reality on the ground.

Perhaps this is why we hear that the Government considering setting up what the SMH called an independent “Planning Tsar” as a way to tackle many of the impasses that plague the NSW planning system.

It is clear that the status quo is not delivering the housing needed.

6. Inner West Council planning principles shows strong support for TODs

Earlier this year, the Albanese Government funded Inner West Council to the tune of $3 million to undertake a planning exercise around housing and specifically transport oriented development. (see story 7 on that).

This gave Inner West Council and the NSW Government an opportunity to delay implementing the TOD SEPP until well after the local council election, with the idea for inner West Council to come back with its own Masterplan.

Fresh from a resounding victory at the council level, the Labor-controlled Inner West Council has released findings from this engagement which shows overwhelming support for transport oriented development around 4 of the stations previously identified – Ashfield, Croydon, Dulwich Hill and Marrickville.

Inner West Council has been given until the end of the year to come back to the NSW Government with an alternative masterplan.

The abundance of well-located areas in the Inner West, all serviced by light rail, heavy rail and bus networks, should result in a masterplan that is even bolder than that originally proposed by the NSW Government.

Equally the NSW Government needs to ensure the masterplan does not become a pea and thimble trick where housing targets are cruelled by the insistence upon affordable housing levies.

It is concerning that Council has set a “goal” of 1,000 new public housing dwellings to be included in the 5-year target of 7,800. Either do it, or drop it and spend the money of parks and open space to support market housing supply.

We cannot see how this will work outside of a huge commitment from the State Government. The private sector cannot be expected to pay for this through feasibility killing levies and taxes.

We await the publication of the Inner West proposal.

7. An Albanese housing fund, ill-conceived and misdirected

While it is concerning that there may have been political considerations behind the allocation of $1.5 billion through the Albanese Government’s Housing Support Program (some suggest pork-barrelling), Urban Taskforce is chiefly concerned that this money has been frittered away on consultants and spurious reports rather than infrastructure which supports housing supply.

The Australian newspaper reported this week on programs up on the Tweed where $275,000 was allocated to “deliver five design-led case studies interrogating different affordable housing typologies and scales across different settlement locations”.

The same article noted that funding went to establish a new Flinders University bachelor’s degree in urban and regional planning, develop artificial intelligence tools to streamline planning approvals, review masterplans and undertake feasibility studies.

Beside a whiff of salted pork, the entire program reflects the wrong type of priorities for the Federal Govenrment amidst a deteriorating housing supply crisis.

The Albanese Government should get back to basics and support a program like the $5 billion housing infrastructure fund promised by the Federal Coalition this week.

8. Stalling commencements make Sydney the “sick man of Australia”

More research from KPMG that shows that when it comes to housing supply, Sydney is the “sick man of Australia”. ^#

The recent ABS data showed commencements and completions in NSW at a decade low – only 46,479 new home completions and a dismal 40,000 commencements in the 12 months to Jue 2024. The annual completions target under the National Housing Accord is 76,000. A huge gap.

Analysis by KPMG’s Terry Rawnsley found just over 12,000 dwellings approved but not commenced in Sydney over the year to June - an 18 per cent rise. Sydney now accounts for 35% of the national total of dwelling approved but not commenced (12,000 dwellings) and a lion’s share of that (82%) are apartments and townhouses.

Source: KPMG

A time series of stalled housing starts in NSW shows a blow out in stalled housing construction starts since March 2023 to the highest levels since 2019. This is because the feasibility is simply not there.

                                                                                 Source: KPMG

Interest rates hikes, construction cost blowouts, regulatory imposts along with a raft of Government fees. Taxes and charges (which have increased over the past 18 months) means that any green shoots in housing starts are being trampled on.

And those green shoots are getting thinner on the ground, with the SMH noting our analysis of the recent ABS approvals data:

The NSW Government cannot control the international headwinds buffeting the NSW economy, but it can deal with the financial and regulatory imposts it places on new housing.

NSW needs to start somewhere, and removing the financial burden on new housing is a good place to start.

# the “sick man of Europe” was a phrase originally coined by another Russian Tsar, this time it was Nicholas I when he used the phrase to describe the ailing Ottman Empire I the mid-19^th century. Since the dissolution of the Ottoman Empire after the First World War, the phrase went on to describe various European nations experiencing economic challenges, most notably the United Kingdom throughout its decline in the decades after the Second World War and culminating in the calamities of the1970s.

9. Quote of the week 

A big week for housing south of the Murray – 50 transport oriented development precincts, stamp duty reform, greenfield releases – all under the mantra of more homes mean more opportunities.

The Victorian Government is showing a way forward on housing supply – with not just an eye to the future but an eye to the polls in 2026. We couldn’t go past this comment from Premier Allan in her interview with ABC radio:

10. New NSW Building Commissioner appointed

We took comfort in his initial statement on how he saw his role as the Building Commissioner. 

A move from confrontation to education and upskilling is a welcome one. 

The new Commissioner’s appointment comes at an important juncture in the building regulatory environment, with the Government working through a new Building Bill.

Commissioner Sherrard starts on December 2. We wish him the best.

11. Feds should help give stamp duty the boot

The Business Council of Australia’s housing report, It’s time to say yes to housing, is a neat summary of the issues that Urban Taskforce Australia has been advocating for years, including: the idea of the Federal Government supporting states who embark of the challenging process of stamp duty and land tax reform; planning reforms to cut red tape; an investment concierge service to assist development through government agency approvals and planning strictures; State Government led planning assessment pathways for major high yield projects; relief from fees, taxes and charges which add to the cost of housing; funding infrastructure to support housing supply; a co-ordinated and sensible “best practice” approach to heritage; and a supportive taxation and planning regime for built to rent and modular homes.

But a lot of the recommendations felt like a fruit-salad of thought – where everyone in the room gets a Post-It note to put on the whiteboard. Nonetheless, it is great to see the BCA come on board. 

Back to Stamp Duty reform ... (we know you are keen) …

The States are fiscally challenged and addicted to the rivers of gold that flow into Treasury coffers through the property industry in the form of Stamp Duty. The longer-term interests of the nation are ignored by short term need for easy revenue.

The Urban Taskforce pre-budget submissions to Federal Treasury urged the Commonwealth to tackle tax reform, much in the same way as they dealt with National Competition Policy in the 1990’s. Assisting States with short term losses and rewarding States that embark upon reform through targeted and conditional financial grant supplementation.

The nation is crying out for a long-term vision.  We need more housing. Replacing stamp duty with a broad-based land tax addresses both.

No Federal Government has touched big picture tax reform since the days of Hawke, Keating and Howard.

The Albanese Government has an opportunity to take up the challenge of far-reaching tax reform here – but will it seize the moment? If they get through the election, this tax reform must be on the agenda.

12. Spotlight on excellence – DEA Highly Commended Awards 

a. Highly Commended Seniors Living – Jardin by Platino Properties

This six-storey development at French’s Forrest caters for the over 55 market. It has been very successful – demonstrated by the fact that there is a waiting list of 200 prospective residents for stage two of the development. The complex includes a roof top garden for residents and for locals as well as a café and fitness facilities. Another quality project by Platino.

c. Highly Commended Community Facility – Blacktown Council’s Exercise Sports and Technology Hub

The jury supported the innovation demonstrated by Blacktown Council in undertaking this project. The site began as an Olympic facility for baseball and softball and has now been dramatically reimagined to a health and wellbeing centre. The architecture and design of the building by ARM Architecture is bold and exciting. A quality public project from Council.

The three winners on the night

The Development Excellence Awards have become highly competitive, and the quality of entries makes life harder and harder for the judges. We look forward to next year’s entries and highlighting the best in our industry.

13. Other news - More NSW Government sites from land audit

The Premier announced a further 30 sites to deliver 1,600 new market, social and affordable homes. This includes nine sites across Sydney and three sites in regional NSW have been identified for future housing development by either Landcom or in partnership with the private sector, to allow the estimated delivery of more than 1300 market and affordable homes.

The Sydney sites include unused government land at three sites at Rouse Hill, and sites at Edmondson Park, Stanmore, Earlwood, North Sydney, Chippendale and Fairfield. The three regional sites are located at Broadmeadow, Morisset and Orange.

14. Council Watch

We note that a number of key Minns Government staffers have also donned the Mayoral robes:

• Dylan Parker - adviser for the Attorney General and Member for Randwick Michael Daley – voted in as Mayor of Randwick;
• Ed MacDougall - Mayor or Bayside and a staffer for Minister for Land and Property and Member for Rockdale, Steve Kamer,
• Mat Howard – long serving staffer for Minister for Transport and Member for Summer Hill, Jo Haylen, is now the Deputy Mayor of Inner West Council.

We look forward to enthusiastic advocacy from them which is consistent with the strong leadership shown by the day-job boss, Chris Minns, the Premier of NSW.

We will be watching closely.

15. Members in the news

*Please note these articles may be paywall protected

“… Sameer Chopra from CBRE says apartment prices in Australia have not kept pace with construction costs over the last five years. read more... 

To read more, click here:                     Macro Business, 15 October

“… While the pipeline of dwellings approved but not yet under construction is falling in Melbourne and Brisbane as more projects commence, analysis from KPMG found an 18 per cent rise to just over 12,000 dwellings approved but not commenced in Sydney over the year to June...read more... 

To read more, click here:                     AFR, 22 October

“… Bob Ell’s Leda Holdings, one of the country’s largest private property development and investment companies, has sold its 4.58ha multi-tenanted estate in Mount Druitt to Gibb Group for $50m…   read more...

To read more, click here:                         The Australian, 23 October

“… Dexus might be the country’s biggest office landlord, but Du Vernet rightly points out the property giant’s interests are much broader than that: industrial property, infrastructure and a growing funds management business…read more...

To read more, click here:                         AFR, 24 October