News & Discussion: Adelaide Real Estate & Market Conditions

[Howie]

What a well written and thought out post stumpjumper, I certainly learnt something from that. Thanks for bringing this issue to my attention.

[stumpjumper]

Thanks Howie. As an average punter, I'm very concerned about the direction the LMC has taken over the years, under both Labor and Liberal governments.

The profits to be made in dealing with real estate have always attracted some of the sharpest and most focussed business minds. No problem there, unless the public interest is compromised as I suggest it may be in the case of the LMC.

Further, the property industry has always cultivated connections with governments. Again, no problem, provided the interactions do not disadvantage the public whose interests the government is supposed to protect and promote.

I'd like to know who or what scrutinises the activities of the LMC, the Property Council and the property industry in general and their relationships with the government. Australian political history, from local councils to higher levels of government, is replete with examples of deals that should never have been done.

With a powerful, relatively secretive long-term government with a tendency to become involved in property development, I believe that South Australia, with as yet no independent anti-corruption body, is particularly vulnerable to this sort of misdealing.

I'd be interested to know what protections there are for the public interest in all this.

[Prince George]

Last week the National Housing Supply Council - an independent group convened by the Government to report on the supply problems driving housing affordability (which I suppose should be 'unaffordability') - released their second report into housing supply across the country. The full report isn't available online yet, but the key-findings are up on their website - http://www.nhsc.org.au/state_of_supply/ ... inding.htm. The entire list is worth perusing, but these two are probably of special interest on this site:

It is hard to develop 'infill' housing in the current housing market and planning framework

Metropolitan plans for our major cities include targets for the proportion of new housing to be provided through infill development of between 50 per cent and 70 per cent. The Council's demand projections indicate increasing demand for attached and medium-density housing over the next 20 years. The Council has explored the likely increase in supply over the next 10 years from infill development as well as from greenfield development.

The Council has noted the barriers to infill development and difficulties that planners and developers face in adding to housing supply in this way. In particular, housing is generally more expensive to build in infill developments than in greenfield ones. For example, in all major Australian cities except Sydney, it costs more to build a two-bedroom unit in an infill development than a comparable three-bedroom house with backyard in a greenfield development. Planning approval and development assessment processes generally add time, uncertainty and costs to the development process regardless of location; there are particular challenges in many infill locations. These uncertainties and delays compound the higher construction and raw land costs that make it generally more expensive and commercially risky to build infill than greenfield dwellings.

Community opposition is often a significant barrier to infill and medium-density development. The options for governments to make up the gap are to increase greenfield land release, increase residential densities on the fringe or take substantial steps to facilitate infill development. It is also important to consider measures to retain, if not increase, affordable rental in infill areas.


Better planning and development assessment systems are needed, aligned with infrastructure delivery, to support housing supply and the growth of cities

The Council's work indicates that demand will continue to increase as the population grows, that supply shortages will put pressure on prices, and that low-income renters will be particularly adversely affected. The Government's significant investment in social and affordable housing will improve the situation for some low-income households. However, the challenges of demand pressures and poor housing affordability are likely to remain unless there is significant supply-side reform.

The planning system is critical for delivering an adequate supply of land and dwellings to meet future demand. Its importance to improving housing affordability and the vibrancy of cities was noted last year by the Prime Minister.

The Council welcomes the Council of Australian Governments' (COAG) agreement to a set of national criteria for capital city plans to ensure sustainable, liveable cities with affordable housing, as well as COAG's broader housing supply and affordability reform agenda.

State and territory governments already have a variety of initiatives under way to streamline development assessment processes and improve the certainty of planning systems. However, greater clarity about the basis for developer charges and reform of planning governance would support COAG's objectives for capital cities, as well as remove barriers to new housing supply.

In particular, clarity about the roles and responsibilities of the different levels of government in the planning system is needed. The way cities are planned and infrastructure is delivered could be improved by considering metropolitan or regional governance of planning and related implementation processes.

The Council is keen to see planning reform encompass greater strategic direction and more as-of-right development and code-based assessment. This should be balanced by measures to ensure public engagement at a strategic level. Such reform, as well as further development assessment reform (such as greater use of development assessment panels to approve major projects), should make the housing market more responsive to changes in demand.

Closer integration of planning systems with the delivery of infrastructure is needed to support residential development. The financing of this infrastructure is an important issue, as is effective planning of the type of infrastructure needed, its quality and the timing of its rollout.

[d3v310per]

From Indaily yesterday - 8/1/2020

https://indaily.com.au/news/business/20 ... ince-2013/

Building sector at lowest ebb since 2013

Australia’s construction sector ended 2019 on a low note with deteriorating activity, new orders and supplier deliveries pushing a key industry index to its lowest mark since May 2013.



December heralded the 16th consecutive month of contraction for the Australian Industry Group and Housing Industry Association Performance of Construction Index, which dropped 1.1 per cent to 38.9 – well below the 50 point mark that separates growth and decline.

Wednesday’s data comes ahead of the Australian Bureau of Statistics’ November building approvals figures, which most economists predict will have bounced back somewhat from a dismal October showing.

NAB, however, says a further decline in unit approvals will likely outstrip a slight increase in house approvals for the month.

Of the four construction sectors in the December PCI release, house building was again the best performing sector with activity showing stability for a second month, up 0.8 points to 50.8.

In contrast, apartment building remained firmly in negative territory, though it rose 0.9 points to 37.4.

Ai Group head of policy Dr Peter Burn said the decline in the engineering construction sector was particularly severe in December, falling at its most precipitous rate in more than a decade

“Commercial construction and apartment building activity also ended the year heading lower,” Burn said.

“In contrast, house building activity lifted marginally.”

Burn said while the number of infrastructure projects in the pipeline was cause for optimism – as was the recent federal announcement of an acceleration of some projects – the broader construction industry was undergoing a difficult period of adjustment.

“This is flowing through to other sectors – particularly to industries supplying machinery and equipment and building and construction material,” he said.

“There is now a clear danger of a self-reinforcing downturn across significant parts of the domestic economy.”