Talking Sense on Housing | CEO Intrapac Property / Past President UDIA (National) / Director Lightning BB / YPO
𝘛𝘩𝘦 𝘣𝘪𝘨𝘨𝘦𝘴𝘵 𝘨𝘳𝘦𝘦𝘯𝘧𝘪𝘦𝘭𝘥 𝘭𝘢𝘯𝘥 𝘳𝘦𝘭𝘦𝘢𝘴𝘦 𝘪𝘯 𝘩𝘪𝘴𝘵𝘰𝘳𝘺 𝘵𝘰 𝘴𝘰𝘭𝘷𝘦 𝘝𝘪𝘤𝘵𝘰𝘳𝘪𝘢'𝘴 #housingcrisis? The Victorian Government is set to announce the new work program for the Victorian Planning Authority (VPA) which will eventually lead to new a swathe of new #greenfield land releases. ✅This is big win, and something UDIA Victoria and developers industry has called for over an extended period. 🗺️The precursor to releasing greenfield land is a planning device known as a 𝘗𝘳𝘦𝘤𝘪𝘯𝘤𝘵 𝘚𝘵𝘳𝘶𝘤𝘵𝘶𝘳𝘦 𝘗𝘭𝘢𝘯 (#PSP). Areas with the Urban Growth Zone of Melbourne, even if identified for development, cannot actually be developed without an approved PSP in place - a job the VPA is responsible for. Over the last four years 𝗷𝘂𝘀𝘁 𝗼𝗻𝗲, 𝘀𝗼𝗹𝗶𝘁𝗮𝗿𝘆 PSP has been finalised, with the VPA refocusing its work on activity centres around Melbourne instead. The Minister for Planning has also sat on and not approved several PSPs for an extended period. ⌛Today's announcement likely only really makes up for lost time, if that. (Meanwhile, I can imagine the purists at the Department of Transport and Planning wincing at the idea that the politics of housing supply are overriding their utopian ideal that people should only grow "up not out" and live in medium-rise activity centres in established Melbourne.) 👍This is a very positive move, but it's too early to celebrate on the land release side. The PSP is a critical step in the journey of delivering new housing, but developers still need planning permits, infrastructure agreements (and delivery) and swathes of other approvals which mean PSPs that are approved soon will still take 3+ years from completion to get moving. And that assumes the various external authorities are put on notice to actually deliver their end of the bargain. 💰The other sleeper issue is 𝗗𝗲𝘃𝗲𝗹𝗼𝗽𝗺𝗲𝗻𝘁 𝗖𝗼𝗻𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻𝘀. Given yesterday's messaging about developers covering all infrastructure costs, and the (incorrect) perception that greenfields cost more than established areas to develop, expect Infrastructure Contribution Plans for these areas, plus design, density and affordable housing requirements, to be so eyewateringly high that new areas will be prevented from being feasible for a long time. Look at the recent Creamery Road ICP of $1.6m/ha for example. 𝗪𝗮𝘁𝗰𝗵 𝘁𝗵𝗶𝘀 𝘀𝗽𝗮𝗰𝗲. So we now have: • Activity centre apartments (which are mostly not-feasible) • Greenfield releases (which will be made too expensive) 🤔The obvious gap that remains is unlocking larger land parcels in middle-ring suburbs for townhouse development. You know, just the most feasible, most desirable for consumers and least costly development for government. #housingsupply #housingreform #planningreform #announcementweek Carly Douglas Shannon Deery
Theodore S.
1mo
Love this post Maxwell Shifman. I think a lot of people in both the public & private realm underestimate the absolutely enormous work that is involved in essentially creating new cities, suburbs & precincts. The issue is seldom “if I unlock x land here, then I will achieve y outcome there”. If you unlocked all the land for development in all of Victoria, the question then becomes is it feasible for a developer to undertake it? Developers aren’t charities. They’re commercial entities just like every other business. A monumental task requires a monumental undertaking, and in equal parts monumental collaboration to do it right, on time & to the expectations of all. This is what’s missing. The government aren’t working with us developers and hearing our concerns. All they appear to be doing is providing knee jerk reactions public outcry’s of issues. They’ve effectively politicised real estate to the point that it becomes a pawn in a game of chess. And we haven’t even scratched the surface of other adjacent topics such as activity centre renewals & uplifts. Victoria is in for quite a ride over the next few years.
Alex McCormick
2mo
I can’t say I ever understood the idea of ‘grow up not out’. Putting more people into smaller spaces has not delivered great outcomes elsewhere. Positive news.
Until they remove all these EBAs and baked in labour costs along with declining productivity we won't be able to build houses at affordable prices. Releasing land won't help if the roads and transport infrastructure is not built correctly 1 and 2 lane roads simply don't work for large sprawl areas as seen in Victoria's west
John Hendriks
1mo
Developers can’t make a profit out of developments anywhere whether it’s townhomes , apartments or greenfield developments . Cost of capital , cost of development , lack of infrastructure, delays in planning and authority consents , lack of consumer confidence. Victoria is the laughing stock of all capital cities in the country when it should be the leader . These new announcements are still 10 years away from materialising. Won’t help the current situation. According to the VPA there is 15 years of land supply so they don’t see any reason or urgency to move forward with greenfield Re zoning. Land taxes , rates and WFT are simply placing pressures on landowners.
Greg McDonald
2mo
And where is the Windfall Gains Tax going to fit into all this equation
Davin Eastley
2mo
Excellent to hear!!
Talking Sense on Housing | CEO Intrapac Property / Past President UDIA (National) / Director Lightning BB / YPO
2mohttps://www.heraldsun.com.au/news/victoria/allan-government-to-release-swathes-of-land-for-new-homes-on-citys-fringe/news-story/80d0fa5e6479fab34943aea2960ad09d