POST 35: THE MCGOWAN GOVERNMENT’S ILL-CONSIDERED HOUSING GRANTS

Introduction.

Population Research WA endorses State Politician Charles Smith’s call that Federal and State Government housing grants are poor public policy. The building grants are a hugely irresponsible misuse of taxpayer’s money. What’s to stop the developer inflating the cost of housing/land packages in light of these grants?

Ross North sales and marketing manager Shane Casserly said just hours after the grants were announced interest spiked, but he warned some parts of the industry had already increased prices or scrapped rebates to gouge customers.[1] State Treasurer Ben Wyatt  (6PR Radio interview (8/06/2020) admitted there is no mechanism in place, which ensure the house and land package offers up a fair market price.

The WA public expect better housing policy than non-means tested grants.

The McGowan Government spending amounts to $117 million use of the public purse for owner-occupiers who build a new house will be eligible for a $20,000 grant.[2] That figure rises to $69,440 (Federal and State combined) if the buyer is a first home owner and eligible for the existing $10,000 first home owner grant and stamp duty concession.[3] Unlike the Federal Government grant, which is means, tested up to $125,000 per annum.[4] The McGowan Government grant enables those that have no need for the additional assistance to access the grants. In summary the Labor Government is handing over $30,000 of WA taxpayers money to very wealthy individuals.

It is hard to fathom Government can come up with such wasteful use of taxpayer’s money. Unable to guarantee the taxpayer’s grants will not be used to bump up the price. The lack of market type based housing policies is clearly evident. Western Australia planning operates under strict Government intervention which seeks to establish high density on very small lots.

Significant grants are being handed out at a time when the WA Residential Design Codes (R-Codes) WA is churning out low-grade housing/land packages and poorly developed neighbourhoods – smaller lots, high-density living, poorer quality of life and lower quality-housing product. (see video below).

It gets worse the use of grants could negatively impact the market price of properties recently built in Perth’s Northern suburbs – many have seen a sharp decline in values. Making it more difficult to sell their properties in established suburbs. For example, first home buyers will be tempted to take up the considerable grants offered to build new house and land packages? There are no grants available to purchase established properties.

 A Market led Housing Recovery.

The McGowan Government needs to curb their restrictive planning policies.[5]  Historically, family prosperity, decentralized economies and commercial development typically follow suburbanisation in Perth’s outer suburbs.[6]

Their infill planning and high density planning laws means Government politicians and planners have far to big a say on how and where West Australian’s should live. Let West Australian citizens choose through testing the demand for decent sized family lots (500m2 plus). This should have been part of a market led housing strategy. The McGowan Government appear to have an anti low-density approach to planning?

Figure 1: Proposed Residential Densities: Draft Park Ridge South and Chambers Flat Plan

(Source: Logan City Council, 2019.[7])

The McGowan Government could learn from the market led initiatives taken up by Logan City Council, situated in the South of Brisbane (population 334,000).[8] Here the planners have a more entrepreneur attitude to planning and are not restricting size of lots on offer. Couples that want to start a family can choose from a good-sized lot. Brisbane’s planners are not fixated on high density (see precinct planning in Figure 1 above).

Logan City planners techniques produce high quality residential communities. Diversity of housing forms that achieve the residential densities proposed in their regional plan (15-25 dwellings per hectare).[9] In contrast, Western Australian Planning is hooked on achieving high population density and infill planning guided by the low standards set in the R-Codes (see video above). Offering residential about 40-60 dwellings per hectare. The R-Codes are being applied In Greenfield sites 60 kilometers north of Perth’s CBD such as Yanchep. This has replaced planning codes, which produced traditional (500m2 plus lot) and more attractive housing setbacks.

In contrast Low Density Residential Zoning is how the Logan City planners produce decent sized lots. This is realised through precinct  planning.[10]  Large suburban precinct (Minimum lot size of 350m2, Average lot size of 500m2) Village precinct (Minimum lot size of 500m2, Average lot size of 600m2) and Large Suburban precinct (Minimum lot size of 1,000m2).

Housing grants will be used to buy an inferior housing/land package?

The grants have been called a job and housing stimulation package. But they are also being used to maintain State Government’s high density planning. State planning laws enforce high-density development as defined in the R-Codes, which controls residential development throughout WA.[11]  Complimented by the Liveable Neighbourhoods (LNs) policy, which is applied to structure planning and subdivision for all Greenfield and infill sites in WA.[12]The LNs puts an emphasis on site planning to achieve high-density targets.[13] It has displaced conventional planning practices, which for many decades produced very high quality low-density suburbs throughout Western Australia.[14]

Due to the McGowan Government’s density planning, there is less opportunity for families to move into the West Australian dream of buying a decent sized traditional lot about 600m2. This unique part of WA’s quality of life and suburban culture is vanishing under the auspices of the R-Codes and LNs and thanks to the McGowan Government’s strict infill policy (47% of all new housing in existing areas by 2050). [15]

The R-Codes and LNs implemented to propel Greater Perth towards 3.5 million people by 2050.

The R-Codes are less about quality of design or keeping high standards. For example, they incorporate liberal interpretations  ‘deemed to comply’ specifications and the variations are vast that they can be easily misinterpreted. WA State Planning has clearly recognized significant problems with the R-Codes but there have been no improvements. Specific technical queries and matters regarding the interpretation of certain ‘deemed-to-comply’ standards are regularly the subject of application uncertainty and determination inconsistency.[16]

In fact there are indications that the R-Codes density concession and wide variations have been formulated at the expense of maintaining high standards (see video above). Unreliable interpretations of the R-Codes can lead to mistrust when consider major planning and development proposals have to be assessed by non expert Developments Assessment Panels (DAPs). Essentially replacing Local Government qualified planners in local and regional decision-making. Yet DAPs have 5 members hand picked by the Planning Minister – some without town planning qualifications.[17] As a result the WA planning system is fostering negative community perceptions.

The R-Codes, LNs and other planning policies have been formulated to promote rapid population and density growth in Greater Perth over the coming decades. State planning has been guided by the Australian Bureaus of Statistics (ABS) Population Projections, which calculate the metropolitan region growing by 1.5 million within the next 30 years.[18]

Nonetheless, the ABS growth forecasts are contested. The ABS assumptions are based on historically rapid growth figures for example when Greater Perth grew by over 445,000 between 2006 and 2016.[19] Over that decade the State had the highest growth on record at 28.2%, higher than all other States and Territories.[20] The ABS projections do not include much less population growth periods over a longer historical period.

 References


[1] Hamish Hastie, ‘WA Builder Raises Concerns of Price Gouging Just Days after State and Federal New Home Grants’, WAtoday, 2020 < [access”>https://www.watoday.com.au/national/western-australia/wa-builder-raises-concerns-of-price-gouging-just-days-after-state-and-federal-new-home-grants-20200609-p55102.html&gt; [accessed 10 June 2020].

[2] David Weber and Emily Piesse, ‘Cash Splash for WA New Homebuyers as Government Unveils Its Own Stimulus Package’, 2020 <https://www.abc.net.au/news/2020-06-07/wa-housing-grant-for-new-home-builds-unveiled-by-wa-government/12330234> [accessed 7 June 2020].

[3] David Weber and Emily Piesse.

[4] Jordan Hayne, ‘Access to the Government’s HomeBuilder Cash Won’t Come Cheap. Here’s What You’ll Need’, 2020 <https://www.abc.net.au/news/2020-06-04/homebuilder-grants-scheme-construction-explained/12320116> [accessed 7 June 2020].

[5] Wendell Cox, War On The Dream: How Anti-Sprawl Policy Threatens The Quality Of Life (iUniverse, Inc. New York., 2006).

[6] Wendell Cox.

[7] Logan City Council, Queensland, ‘Draft Park Ridge South & Chambers Flat Plan’, 2019 <https://haveyoursaylogan.com.au/43028/widgets/230704/documents/96927> [accessed 8 June 2020].

[8] .idcommunity, demographic resources, ‘Home | Logan City Council | Community Profile’, 2020 <https://profile.id.com.au/logan> [accessed 8 June 2020].

[9] Logan City Council, Queensland.

[10] Logan City Council, Queensland.

[11] Western Australian Department of Planning, Lands and Heritage, ‘SPP 7.3 Residential Design Codes – Volume 1’, Department of Planning Lands Heritage, 2019 <https://www.dplh.wa.gov.au/rcodes> [accessed 3 June 2020].

[12] Western Australian Planning Commission, ‘Liveable Niegnourhoods (Draft 2015)’, Department of Planning Lands Heritage, 2015 <https://www.dplh.wa.gov.au/policy-and-legislation/state-planning-framework/liveable-neighbourhoods> [accessed 25 October 2019].

[13] Western Australian Planning Commission, Liveable Neighbourhoods: A Western Australian Government Sustainable Cities Initiative (Perth, W.A.: Western Australian Planning Commission, 2007).

[14] Western Australian Planning Commission, Liveable Neighbourhoods.

[15] Government of West Australia, Department of Planning, Lands and Heritage, ‘Perth and Peel @ 3.5 Million Frameworks.’, 2018 <https://www.dplh.wa.gov.au/perth-and-peel-@-3-5-million-frameworks> [accessed 2 October 2019].

[16] Western Australian Department of Planning, Lands and Heritage, ‘State Planning Policy 7.3 Residential Design Codes’, 2019 <https://www.dplh.wa.gov.au/rcodes> [accessed 21 May 2020].

[17] Government of West Australia, Department of Planning, Lands and Heritage, ‘Development Assessment Panels Procedures Manual’, Department of Planning Lands Heritage, 2020 <https://www.dplh.wa.gov.au/daps> [accessed 25 May 2020].

[18] Australian Bureau of Statistics, ‘3222.0 – Population Projections, Australia, 2017 (Base) – 2066’, 2018 <http://www.abs.gov.au/AUSSTATS/abs@.nsf/Latestproducts/3222.0Main%20Features12017%20(base)%20-%202066?opendocument&tabname=Summary&prodno=3222.0&issue=2017%20(base)%20-%202066&num=&view=> [accessed 5 May 2019].

[19] Australian Bureau of Statistics, ‘3218.0 – Regional Population Growth, Australia, 2016’, 2017 <http://www.abs.gov.au/AUSSTATS/abs@.nsf/allprimarymainfeatures/7B33A7E366915C49CA258291001DFE75?opendocument> [accessed 14 April 2019].

[20] Australian Bureau of Statistics, ‘3218.0 – Regional Population Growth, Australia, 2016’.

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