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“While an increase in the supply of higher and medium density housing will play an important role in making housing more affordable and accommodating higher numbers of people as Victoria’s population grows, it is not the only solution.
“Good housing policy ensures homebuyers of all ages and backgrounds have choice in the diversity of housing options, whether that’s an apartment, semi-detached or detached dwelling in an established or new suburb.
“The facts are that the majority of Victorians prefer to live in low to medium rise housing (i.e., 4 or fewer stories). The 2021 Census showed only 12 per cent of the population live in an apartment. Similarly, in the five years to 2022/23, less than 20 per cent of new homes built nationally have been above 4 storeys.
“This tells us that low rise buildings are also likely to continue to play a major role in meeting Victoria’s housing challenge.
“This is why we need a planning system that enables all forms of housing to be delivered with more certainty about outcomes. The system needs to be streamlined and without excessive fees, taxes and charges.
“HIA has long acknowledged the need for more public, social and affordable housing, but warned against extending the Victorian planning framework to allow councils to make it compulsory for developers to provide affordable housing, however defined, as an inclusionary requirement,” said Mr Ryan.
“Inclusionary zoning programs make some local councils and social interest groups believe they are supporting low-income families and promoting social inclusion.
“However, in a high-cost housing market unless such schemes provide powerful incentives to offset the loss a developer would incur on an inclusionary zoning home sold below market rates, there is a strong likelihood they simply won’t be built.
“Mandating inclusionary zoning will have equally adverse effects with developers likely to raise the price of market-rate dwellings in the same development to compensate for the loss. This exacerbates the affordability crisis and only adds additional pressure to house prices.
“There is no single panacea for Victoria’s housing crisis but a whole of government approach to addressing supply and demand challenges has the best chance of success,” concluded Mr Ryan.
HIA’s recently released Action Plan: More Houses for More Victorians, outlines six priority areas where reform is needed most:
“Australia’s population reached 27.4 million by the end of 2024, up by 445,900 people, or 1.7 per cent for the year,” stated HIA Senior Economist, Tom Devitt.
The Tasmanian election that no-one wanted to have is in full swing, and while the limited campaign period is unlikely to provide the usual platform to promote key policies and reforms, HIA is calling on both major parties to prioritise housing policies given the significant challenges across the state.
“Our dated and complex planning system is littered with speed bumps that could easily be removed”, said Brad Armitage, HIA NSW Executive Director.
“The Victorian government’s proposal to update home building contract laws to make them fit for use in the 21st century is welcomed by HIA,” stated HIA Executive Director, Keith Ryan.