Sussan Ley (Farrer, Liberal Party, Shadow Minister for Housing) Share this | Hansard source

I am pleased to talk on the MPI today about rising prices. I was pleased to hear the members for Prospect and Lindsay both mention a subject dear to my heart, which is housing affordability. The member for Lindsay has made remarks in this place about that topic, which is important to his constituents of Western Sydney.

I want to provide those members and the House with some figures about the cost of developing land and putting a house on it in the growth areas of north-west and south-west Sydney. These figures were released with a big fanfare by the New South Wales government in 2001 but, unfortunately, not one single house has appeared and not one single lot has been developed. I will explain why. The costs for the developer are as follows: to purchase the lot, and 450 square metres is not very big, $50,000; a special infrastructure charge, payable to the New South Wales government, $23,000—a special charge because it is in the growth centre; a section 94 contribution to local council, $30,000; water, energy and gas costs, $20,000; and stamp duty, $2,500. Of course, there are costs that the developers have to pay for architects and their own work and GST of $10,000. But the total cost to a developer of developing one of these blocks of land is $302,000. The market will bear a cost of about $300,000. As a new homeowner, that is what I pay for my block of land. That is the market price. So the developer is not going to go ahead with it, and I am not going to purchase it. And that is why not a single block of land in these growth centres has been developed.

This MPI is important. We talk about the government not adequately addressing the impact of the rising costs on struggling families. Inflation and the increases to mortgage rates are mentioned and of course they are significant. But these housing costs are much more significant. It has been recognised many times today and this week that housing affordability is a problem. If I front up as a new homeowner and get the keys to my new home, I am paying $90,000 to $100,000 in taxes to the state government. If my mortgage was $90,000 to $100,000 less, I would not be suffering from as much mortgage stress as we read about every day. When you look at these costs to deliver an available block to the homeowner, you can see where the problems are. If Labor wants to improve housing affordability, it should force its state Labor mates to drop these imposts on housing, because it is state governments that are actually imposing housing affordability taxes. We cannot even rezone ‘rural’ land to ‘urban’, because the command and control mentality of the state government—and I am talking about New South Wales—has put these developers on the drip feed. I believe the reason for that is that there is not the scope for the government owned utilities to develop the energy and water infrastructure on these blocks that is required. The areas are zoned, but they are still rural. Nothing is happening; meanwhile, homeowners are desperate.

The government has announced a couple of measures in response to the housing affordability crisis. I do not want to pour cold water on all of them, but I wonder how well they will work. The Prime Minister was asked in question time today about the first home saver account. He could not explain to the Leader of the Opposition why a person earning $200,000 a year would receive $1,500 of taxpayers’ money, but an apprentice earning $10,000 would only receive $750 of taxpayers’ money. The Prime Minister could not answer that question. I asked the Minister for Housing that question a few weeks ago and she could not answer that question, either. So, in designing a first home saver account, can we please inject some equity. Can we ensure that we actually help the people whom we are designing a project for.

Another interesting measure that the government has introduced is the Rental Affordability Scheme. This is about giving developers $6,000 in tax relief to build houses in certain regions. The bottom line is that the expectation of any investment scheme launched in a free market economy should be that it delivers a fair level of income and a fair level of return; otherwise, you will not get any investment into it. I am not confident that investors will in fact take up this initiative. I have seen no evidence or indication that they will. The Housing Affordability Fund, likewise, is a bucket of $500 million for state governments and local councils to dip into to fix up the inefficiencies that they should be fixing up. (Time expired)

See this speech in context