Corporate News

Villawood executive director Rory Costelloe has told the Australian Financial Review he backs fast-tracked visas but also calls for measures to stimulate demand for housing including bringing back stamp duty concessions for off-the-plan buyers.

These would then lead to more future supply being delivered – there is about an 18-month delay between land sales and housing starts, he said.

“The 11 interest rates rises have now virtually stopped land sales with only 6000 to 7000 sales projected for 2023 (in Victoria) means there will only be 6000 to 7000 new housing starts available for construction in 2024/25 at a time when we have a critical housing shortage with record immigration intake,” Rory said.

“The whole construction industry is now suffering the same collision of price rises at peak demand making many projects unviable. Costs of suppliers, contractors and subbies must be reset to assist developers and builders to meet the market.”

Rory said developers had already cut their lot prices to meet the market but builders’ efforts to do likewise were being hampered by “(price) gouging of big suppliers of building materials”.

“Things like crushed rock and concrete are so expensive,” he said.

In Melbourne, local councils were reducing the supply of housing by setting their own density limits outside of State government guidelines, he said.

“A precinct structure plan may include a density limit of 16 to 17 dwellings per hectare, but once its down to the council, they only allow 12 to 13 dwellings per hectare.”

 

Article by Larry Schlesinger & Michael Bleby – published in the Australian Financial Review, March 19, 2024  https://www.afr.com/property/residential/visas-for-tradies-planning-reforms-crucial-to-lifting-housing-supply-20240319-p5fdi8