This Weeks Featured Article
Some thoughts on this week in politics…
They Don’t Get It!
As to housing affordability, they just do not get it at all. The Lord Mayor of Newcastle talks about the dollar amount that the council has approved for housing and thinks we in Newcastle have done well but it is not the dollar amount of the approvals that will give affordable housing but the number of low cost housing constructed.
LAND SHORTAGE SENDS PRICES SOARING
BY NICK BIELBY —16 / 02 / 2018
A LACK of “shovel-ready” residential land in the Hunter and high median lot prices are stopping people entering the housing market, experts say.
But the peak housing industry body says building approvals for dwellings across the region – including renovations and additions, as well as new homes – are “as high as they’ve ever been”, despite slowing growth in Newcastle.
Housing Industry Australia’s Hunter branch released data this week that showed sales of vacant residential land dropped 30 per cent across the region in the six months to September.
The Hunter’s median land value was $230,000 in the September 2017 quarter – the highest since HIA began collecting the data in 2001.
HIA Hunter executive director Craig Jennion said a shortage of titled land ready for sale or development – “shovel ready” – had pushed up the median lot price.
“The easing in the volume of Hunter land sales is concerning as land sales provide an indication of future residential house construction,” he said.
Lower Hunter builder Stephen Murray, who runs Yarrum Designer Homes, agreed and said high land prices were pushing many first home buyers further out of the city or forcing them to put off entering the market.
“There appears to be plenty of land that is zoned,” he said. “But in terms of land available with a [development application] approved that developers can go in and develop, it is very different”
Australian Bureau of Statistics figures also released this week showed the rate of residential building approvals in Newcastle increased by three per cent in the year to December, 2017 – a slowdown from 29 per cent in the previous 12 months.
Approvals in Newcastle made up 28.7 per cent of the Hunter’s total last year, behind Lake Macquarie’s 30.5 per cent. Maitland made up 18.5 per cent and Cessnock accounted for 11.1 per cent.
Despite the slowing growth, Mr Jennion said approvals in Newcastle remained strong. Even though the year-on-year increase had dropped, he said approvals were “still extremely elevated”, particularly due to a rise in unit block developments in recent years.
“There’s plenty of residential land in the Hunter – in some cases there’s an over supply – but it’s not titled, developed, shovel-ready and available in the next three to six months. That’s our concern,” Mr Jennion said.
Newcastle lord mayor Nuatali Nelmes said the council approved $1 billion in residential and commercial development applications last year, for the first time in history. She said the total was likely to top $1.5 billion this year.
“It’s great to see our building boom radiating out across the region,” Cr Nelmes said.
Land sales are always released in small parcels to obtain the highest prices possible so that developers can get the greatest returns, however the councils always speak in terms of the dollar value of the approvals for each period of time and seem to think success is in the dollar value, and it never is there at all. Success is in the number of residences build that are affordable for the people struggling to find a place to live in. Big towers in the city and near the university do not contribute to affordable housing at all. Low cost housing needs to be front and center in development of housing. It is about time we made affordable housing a condition of development of housing estates and residential tower blocks.
Of course housing affordability is further compounded in Newcastle with a totally dysfunctional transport system that has seen a rail line shut down between Stewart Avenue and the Newcastle Rail Station so that a “light rail” could be constructed in the middle of Hunter and Scott Streets less than a stones throw from the rail corridor at a cost, so far, of about to $700,000,000.00 when a tram conversion on existing train rolling stock could have achieved at a cost of $6,000.00 per carriage – for 100 carriages that is $600,000.00 and this would have been progressively achieved without any transport interruptions — The “light rail” is nowhere near complete and has seen years of total mess and interruption to traffic, transport and businesses. Many businesses will not survive the disruption to their businesses as their cost of being there far exceed their income that can be generated. With the sale of the formally government owned Newcastle Buses to a company that has proved that they are unable to deliver community acceptable levels of convenient transport adds to the problems of affordable housing to the low income earners. The difficulties of getting reasonable transport with good connections has meant that some have either had to move where they live or to seek employment closer to their current home; yet the job opportunities fort he low paid workers are very poor in this area.
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