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Beyond the expected

Zed savages land release

By johnboy 25 February 2011 12

Liberal Leader Zed Seselja has jumped on the Auditor-General’s verdict on land release in the ACT.

“This is a nine year old ACT Labor government, who keep saying we’ll now see better outcomes, when their policies have made things worse, pushing up prices for young families,” Zed said.

“Programs touted by the Government as innovative, like the land rent scheme, have been found by the Auditor-General to create a great deal of risk for the government with high cancellation rates as well as the majority of land rent blocks not been taken up by the targeted clients – low income lessees.

“For some time the Canberra Liberals have said that improved infrastructure delivery, having a genuine land bank available that is significantly more than expected demand and improved commercial competition for land will all help to improve land supply and affordable housing.

The Government remains silent on this one.

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Zed savages land release
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hax 4:18 pm 04 May 11

SigmaOctantis said :

There’s plenty of room in NSW, vote with your feet and show the powers that be how unacceptable the house price situation is by moving away.

..and then we can send them a strong message when we vote.. in the NSW elections?

SigmaOctantis 3:14 pm 04 May 11

“Meanwhile, see the slow lines of cars coming into the ACT from NSW every day, people who have moved further away to where they can afford… fibro and weatherboard houses and an hour’s drive into work.”

We just moved from Bruce to Bungendore, and for the price of 1.25 of the 75sqm apartment we were living in we bought a 4yr old 300sqm 4bd house on 1200sqm of land. It’s a 45 minute drive to work in the morning, 35 minutes back. Talk about a no brainer.

At the end of our time in Bruce it took 25 mins to get to the city, due to the never ending roadworks. To say nothing of the dramatically reduced standard of living in Bruce over the past 3 years due to mushrooming high density ‘affordable’ slums, I mean apartment blocks. We had our post stolen, neighbours cars were broken into, drug deals going on outside the front door, tailgating hoons in those rediculous V8 utes, etc etc. I can’t believe people are still willing to pay through the nose and live like that just so they can be 20mins closer to work. That’s something Canberra Council is depending on.

There’s plenty of room in NSW, vote with your feet and show the powers that be how unacceptable the house price situation is by moving away.

EvanJames 2:48 pm 04 May 11

This is an interesting discussion. Richardh’s points especially are telling. Housing prices don’t reflect the value of the houses on them, it’s an artificially inflated price caused by supply being limited. For a government to do this to enable them to collect more money is downright evil.

Every year as more and more people buy at these prices, pressure increases to keep prices high. If prices fall below what they’ve borrowed to buy, then the pooh will hit the fan horribly.

Meanwhile, see the slow lines of cars coming into the ACT from NSW every day, people who have moved further away to where they can afford… fibro and weatherboard houses and an hour’s drive into work.

georgesgenitals 1:34 pm 04 May 11

We’re seeing the start of the correction now, and will continue to do so for some years. I wouldn’t hold your breath about median properties getting down to 3x median incomes, though.

urchin said :

To wit: a 333m2 block in Bonner goes for 197k or $582/m2. The UV of a 552 m2 lot in Amaroo–right across the street mind you–is 115k or $208/m2.

We often disagree on property related stuff, but I reckon you’ve hit the nail on the head with this. There has to come a point where land release is about supporting the community, rather than simply maximising revenue.

johnboy 1:12 pm 04 May 11

“The market can stay irrational longer than you can stay solvent” – John Maynard Keynes

Chop71 1:05 pm 04 May 11

D2 said :

richardh9935 said :

The correction will come – it’s only a question of when.

Everyone has a theory on this and prices change over time.

1. You can sit on the sidelines and pay rent waiting (in the hope) for the prices to fall.
2. Move to the country and pay 100-200k less for a similar property
3. Move to a capital city and pay 200k+ more and have less services and higher unemployment
4. Pay the bank, For all the whinging, Canberra is a pretty cool place to live and it’s just one of the costs of living here.

D2 12:35 pm 04 May 11

richardh9935 said :

Real estate prices were absurd when the ratio of median house price to median income was 6. It’s meant to be 3. It was 3 until this century, when banks, buyers and real estate agents colluded to push every house up to $1 million.

The US real estate market busted when the ratio went past 6. Now we’re at about 10. Just why do buyers think they can afford these prices? My nephew has signed a 45 year mortgage. How can a bank and a young person see that as reasonable?

More people should sleep in the ACT Assembly offices and in their car parks, to prove we can’t afford these prices.

+1

The correction will come – it’s only a question of when.

EvanJames 11:35 am 04 May 11

“This is a nine year old ACT Labor government, who keep saying we’ll now see better outcomes, when their policies have made things worse, pushing up prices for young families,” Zed said.

Oh good, only Families will be affected. The rest of us are OK then.

Chop71 10:45 am 04 May 11

…. or wages must rise

richardh9935 10:30 pm 25 Feb 11

The ACT government, regardless of political shade, wants land prices as high as possible, because it relies on land sales as income. However, this is a very short-sighted attitude. Land is limited.

What other income is available? None, really, because the Feds won’t pay rates. However, the Feds pay GST. We need to revive the issue of having a national capital. If the Feds want one, they better pay for it. Otherwise, we’re just another small NSW country town, going bust in the dust.

Meanwhile, high house prices force people away. See Brasilia, where below-median-income workers live in satellite cities and travel hours to get to work.

Sorry, house owners, your prices MUST fall if your children and your staff are going to live here. You MUST also accept triple the housing density to get prices down.

richardh9935 10:20 pm 25 Feb 11

Real estate prices were absurd when the ratio of median house price to median income was 6. It’s meant to be 3. It was 3 until this century, when banks, buyers and real estate agents colluded to push every house up to $1 million.

The US real estate market busted when the ratio went past 6. Now we’re at about 10. Just why do buyers think they can afford these prices? My nephew has signed a 45 year mortgage. How can a bank and a young person see that as reasonable?

More people should sleep in the ACT Assembly offices and in their car parks, to prove we can’t afford these prices.

urchin 7:35 pm 25 Feb 11

while i agree that the land rent scheme is nothing short of fraud, i don’t think the problem is as complex as zed portrays. in fact, it’s quite easily resolved – reduce the price of land, give individual buyers first go on the condition that they build on it in one year and live on it for another year before they can rent or sell it. anything left can go do developers. the prices are ridiculous. To wit: a 333m2 block in Bonner goes for 197k or $582/m2. The UV of a 552 m2 lot in Amaroo–right across the street mind you–is 115k or $208/m2.

Why is land across the street suddenly worth 3x as much? is it the added convenience of not having a yard? Is it because you get to live in a construction zone for the next 5 years? You go to the same school as the Amaroo kids, you’ll be going to the same shops as the Amaroomians… So why the discrepancy?

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