Fixing the supply side

The Victorian Governments response to fixing housing affordability will focus on the supply side. Apparently rejecting proposals for rent caps and freezes which would divert investor funds out of residential development.

The industry is hopeful the reforms can provide certainty and remove the excessive regulations that come with complex and lengthy approval processes. How much control the State Government is prepared to take away from local authorities will be the key to speeding up the supply of new dwellings.

With a housing construction sector still in recovery mode from escalating input costs, higher interest rates and weaking consumer demand, some significant incentives will be required to have a noticeable impact on stock.

The use of inclusionary zoning either with a mandatory or incentive model should be part of the solution. Successful in various cities around the world, a well-planned model can provide developers with certainty and incentives to provide a significant increase over time of affordable housing.

There are many examples of where the existing complex and lengthy approval processes with excessive regulations, hinder the delivery of housing projects.

A streamlined regulatory framework and simplified approval processes providing clear guidelines for developers will be required to be able to come anywhere near the ambitious targets for new affordable housing.

Keith Bayliss