Alarm at low number of single houses being approved in the ACT

Land not for sale: Building your dream house in the ACT might be more difficult than you think.

The number of new dwelling approvals in Canberra ACT appears to have fallen in a hole, particularly for apartments, but according to Master Builders ACT, the real worry is the low number of single, detached houses being built.

According to data released by the Australian Bureau of Statistics (ABS), the number of ACT dwellings approved slumped by 32.6 per cent in January as opposed to a 0.1 per cent rise nationally.

In January, 132 dwellings were approved, of which 55 were units, 48 houses and 29 semi-detached or townhouses. From October, only 67 apartments have been approved, coming off highs of 513 in August and 431 in September.

In the same period, 331 single detached houses have been approved with a high of 105 in October.

Master Builders ACT CEO Michael Hopkins said while the drop in apartments could be accounted for by a lag in development applications and approvals, the low number of house starts was a result of Government land release policies that ignored the demand in the market and drove buyers across the border.

He also accused the Government through the Suburban Land Authority (SLA) of profiteering when it came to land sales.

Mr Hopkins said he expected apartments’ approvals to pick up, especially with so many developments in the pipeline for the Northbourne Avenue light rail corridor.

He said January’s figure for single houses was the lowest in the past 12 months.

“This is a direct result of the Government’s land supply policies, where they are restricting houses despite there being a really strong demand from Canberra families for land to build a single house,” Mr Hopkins said.

Contributing to this was the Government’s 50-50 policy which targeted 50 per cent of new dwellings in greenfield areas and 50 per cent in infill, which only led to sharp rises in land prices and affordability issues.

“While we support the Government’s vision of a bigger Canberra focused on renewal around town centres and along transport corridors, at the end of the day, housing policy needs to be based on evidence and it needs to be based on the type of housing that Canberrans are needing to live in, and in a community which is still dominated by nuclear families, couples and couples having young families that drives the demand for single housing, I think it’s important that any housing targets the Government sets are based on that evidence and not just arbitrary 50-50 type policies,” Mr Hopkins said.

“Because there is really no point building thousands of apartments if Canberra’s demographic make-up has a skew towards families.”

Mr Hopkins said Canberra needed to be considered as a region, with people seeking single and affordable houses looking over the border to places such as Googong, where a lot of families were buying houses and a lot of Master Builders members building houses.

He described the SLA’s gross margins of between 40 and 70 per cent as super profits, well above industry expectation.

“That would mean that the Government has plenty of capacity to offer discounted land to groups like community housing providers, to offer affordable housing, and that would be a really valuable contribution the SLA could make to the community,” he said.”

“In Canberra, we have some good financially sustainable community housing providers but at the moment they are not getting any relief on land prices from the Government.”

Mr Hopkins said the recent Grattan Institute report on housing affordability confirmed the Master Builders view that releasing more land for housing would help resolve the issue.

He said the report found that if 50,000 more homes were built across Australia, that would have a direct impact on prices.

“A large part of our housing affordability problem is actually a land affordability problem. In the ACT the Government has a direct opportunity to influence that because they are the land owner and the developer,” he said.

Have you tried building a house in the ACT? What has your experience been like? Share them with us in the comments section below.