What Does 2021 Hold for the Property Development Sector?
This article by Tom Forrest CEO of the Urban Taskforce is an interesting read.
The newspapers are full of bullish predictions for 2021 on the back of the development of a COVID vaccine and the expectation that President-Elect Joe Biden will be pumping up the economy with Federal Reserve cash.
There has been a lot of focus on economic policy over the past year and lots of promises have been made – particularly in the area of Planning reform in NSW.
The planning reform agenda has been informed by the NSW Productivity Commission Green Paper and its separate review into infrastructure contributions. Unfortunately, some in the planning space have resisted reform, a focus on efficiency and the acknowledgment of economic growth as the key objective of the planning system and the actors within it.
The key to success in 2021 will be holding the public servants and their political masters to the sensible commitments they made during the height of the COVID 19 Pandemic.
- Restoring immigration numbers to above pre-COVID levels and thus bolster the tax-payer base, stimulate demand for housing construction and boost economic growth
- Ensure the planning system (DPIE, Councils, independent panels, and the Courts) deliver more approvals, more constructions start, and more completions than are required – thus placing consistent downward pressure on prices for the first time since the 1980s
- Abolishing Stamp Duty and replacing it with a broad-based property tax (with savings provisions as proposed in the NSW Budget in November 2020)
- Developing a policy which will encourage investment in Seniors’ Living
- Developing a Housing Diversity SEPP which will see the development of a diversity of homes in all suburbs at all price points (without pumping prices through the roof through over-regulation and prescriptive standards)
- Developing a workable Court appeals mechanism for re-zoning applications
- Rationalise the Apartment Design Guide (ADG) and allow for innovative solutions to meet all price points by reducing prescription
- Implementing changes to local and state infrastructure charges on a permanent basis – reducing the burden on new home buyers
- Abolish rate pegging and eliminate “infrastructure charges” which have no nexus with the development (eg. affordable housing levies)
- Developing a Build-to-Rent scheme that actually works to stimulate both foreign and local investment, while developing an effective alternative to homeownership
While the newspapers are bullish, some of this is, no-doubt, wishful thinking, and self-serving prophecies. Read the full article here.
