From the Council of Australian Governments – 22 April 2010 – COAG said this week it would look at competition issues in land supply as part of its inquriy to target the slow supply of new housing, house price pressures, population growth and “a healthy economy continuing to add to strong housing demand.”

“Housing supply has not responded as strongly as it could have to this demand.  Unless demand-side pressures are well understood and supply-side constraints are identified and addressed it is likely there will be greater pressure on house prices,” COAG said.

Following is an extract for its statement of intention.

“The housing supply pipeline comprises the stages of housing development from land identification, release and zoning, through to infrastructure planning and subdivision approval, construction and titling of the subdivision, and finally dwelling approval and construction.

“The National Housing Supply Council has found significant variation across jurisdictions in the time taken for each of these stages, and identified the need for continuing effort to improve the efficiency of the planning system.

“COAG today endorsed a housing supply and affordability reform agenda and timeline (below).  The agenda focuses on the primary areas where gains may be achieved in decreasing the time it takes to bring housing to the market, reforming government policies that act as barriers to supply or that artificially stimulate demand and ensuring efficient use of existing housing stock.”

Areas for potential reform include “planning and zoning governance reforms; considering national principles for residential development infrastructure charging; examining relevant Commonwealth and State taxation settings (with the timing to be dependent on the Commonwealth Government’s response to Australia’s Future Tax System).

Competition in land

The reform may also include “extending government land audits and examining private holdings of large parcels of land to assess the scope for increasing competition and bringing land quickly to market.

Housing reform agenda and timeline

The Housing Supply and Affordability Reform Working Party will report to COAG, via the Ministerial Council for Federal Financial Relations, on the housing supply pipeline, comprising an examination of:

  • the potential to reform land aggregation, zoning and planning processes and governance, including assessing and leveraging the work of Housing and Planning Ministers and the Business Regulation and Competition Working Group (by mid-2010),
  • nationally consistent principles for housing development infrastructure charges (by mid-2010),
  • the merits of measures to ensure greater consistency across jurisdictions, including local governments planning approval processes, in the application of building regulations (by mid-2010),
  • the impacts of titling systems (such as residential strata title arrangements) on the housing supply market (by end-2010),
  • the efficiency and effectiveness of housing supply/land release targets (by end-2010),
  • whether strategic planning requirements for cities should be extended to other high growth/large population regions across the country (mid-2011)
  • extending the land audit work to examine ‘underutilised’ land and to examine private holdings of large parcels of land (by mid-2010) government policies that may act as barriers to supply or that stimulate demand.

The land audit will include  examination of the impact of:

  • the First Home Owners Scheme (by end-2010)
  • Commonwealth policies that impact the housing market (by end-2010)
  • both Commonwealth and State energy efficiency regulations and environmental acts, including the Environmental Protection and Biodiversity Conservation Act 1999, on house prices (by end-2010),
  • both supply and demand side affordable housing initiatives (such as inclusionary zoning, dwelling mix and distribution of lot sizes) on the housing market (by mid-2011)
  • relevant Commonwealth and State taxation settings (with timeline to be dependent on the Commonwealth government’s response to Australia’s Future Tax System).

tperinott@thefifthestate.com.au