Planning Reform to be Assisted by Housing Affordability Fund

Rigid and complex planning systems have long been the bane of the residential building industry, frustrating its ability to keep pace with changing market needs and to deliver affordable housing.

The importance of planning and building regulatory systems to national competitiveness is recognised at the highest levels of government. Despite this, our planning systems remain disparate and under strain costing aspiring home owners tens of thousands of dollars which should and can be avoided.

Most complaints about planning system inadequacies are consistent. Lengthy delays and uncertainty are a common feature.  Many local councils and planning authorities simply don’t understand the impact of delays.  Put simply, delays cost the home buyer.  Delays not only result in additional holding costs for developers and builders, but for the consumer they mean additional interest on borrowings and additional rent. All too often these delays relate to indecision or inefficiency by a planning authority. 

Practical planning reform is long overdue, but the process has at least begun. It is important that planning systems deliver smarter and easier-to-understand processes for all users of the planning system from the major developers to mums and dads wanting to build an extension in the back garden.

The ideal planning system must be predictable, but with sufficient flexibility to accommodate innovations in design and development in a fast-changing world. Above all it must be affordable, as the ability to obtain appropriate accommodation at a reasonable price is fundamental both to our living standards and to the nation’s economic health. Practical reform can remove the inherent uncertainties in our planning systems which will lead to a reduction in cost as well as improved outcomes.

Thankfully, the Federal Government has recognised that this is a real problem that must be fixed.  The Housing Affordability Fund is a $512 million dollar scheme designed to improve what is all too often a planning nightmare for builders and consumers alike.

The Fund provides $512 million for local and state governments to meet the cost of infrastructure required to support new residential development.  Funding is awarded to local and state government proposals that demonstrate efficiencies in planning that will reduce the cost of new housing. 

The consumer is the ultimate beneficiary from the Fund, as savings are to be passed on through a reduction in the ‘sticker price’ of the new house. 

HIA estimates that developments supported by the Housing Affordability Fund could save $20,000 on the price of a new home. Over the course of a loan, this amounts to a $50,000 saving, enough to put your first born through secondary school. 

We look forward to seeing proposals for HAF from ACT Government and surrounding local councils, many of which do not have a great track record when it comes to planning approval timelines for residential construction.  The assistance is there now and the opportunity to improve processes with Federal Government financial assistance should not be squandered.