Home builders are backing the opposition’s latest pricey proposal to ignite a residential construction boom by cutting industry red tape and stabilising construction costs.
On Saturday, Opposition leader Peter Dutton capitalised on the current housing policy split within parliament by unveiling the party’s latest pitch to make good on Alabnese’s promise to deliver 1.2 million homes by 2029.
The centrepiece of this proposal was the $5 billion “use it or lose it” housing fund, which would be distributed amongst a mix of grants and concession loans that would make their way toward shovel-ready infrastructure and accelerate the development of hundreds of “greenfield sites” across the country.
The Coalition said these grants would be handed out on a “time-limited basis”, with the funds earmarked for the construction of essential infrastructure including water, power, sewerage and access roads needed for the development of home plots.
According to Dutton, this targeted timed funding would strike at the heart of the problems waylaying home construction at a time when the country needs them most.
“We know there are hundreds of greenfield sites across the country ready for development, but progress has been stalled due to a lack of funding for essential enabling infrastructure,” he said in a statement released following the announcement.
“Our approach is focussed on investing in enabling infrastructure to unlock the supply of shovel-ready new housing developments.
“The cheapest form of housing for first home buyers is detached housing with backyards and our Housing Infrastructure Programme will be a catalyst for exactly this – new greenfield housing developments.”
The four-year funding scheme, available to local governments, state- and territory-owned utility providers, property developers and special purpose vehicles, “will be offered on a ‘use it or lose it’ basis”, with projects that don’t make progress after 12 months having their funding cut.
The party also called for a 10-year freeze on further changes to the National Construction Code, which industry bodies argue added up to $60,000 to new home prices earlier this year.
“At a time of high inflation, the government’s changes to the NCC have added red tape and increased the compliance burden for new housing projects, driving up costs for purchasers,” said Dutton.
“The Coalition’s freeze will provide certainty to the industry and let builders get on with the job of building homes for Australians.
“We further commit to working with industry to review the government’s changes to the NCC and identify options to further reduce red tape and bring down costs for consumers.”
Despite the new changes upgrading the sustainability practices of home builds to fall more in line with standards used across the globe, construction lobbyist groups like the Housing Industry Association (HIA) argued that the rushed implementation saw the industry unprepared for the higher cost of doing business.
“These most recent NCC changes added more red tape hampering productivity and are key factor in driving up home building costs for builders and homeowners, and these were introduced at a time when cost of living pressures is locking more Australians out of housing,” said HIA Managing Director Jocelyn Martin.
“HIA is also aware that the next round of NCC changes is under consideration by Federal and State governments and these will again add more complexity and costs to buildings.
“The residential construction industry and particularly small business are struggling under the weight of red tape, and this is hampering the delivery of new homes.
“This initiative to place a pause on further rule changes will provide certainty to the industry and let builders get on with the job of building the homes Australians desperately needs.”
With construction costs already climbing by 40 per cent across the board and build times blowing out by up to 47 per cent under the current government, Master Builders Australia CEO Denita Wawn also welcomed the Opposition’s attempts to right the housing ship.
“We know that the key to ending the housing crisis is unlocking new housing supply, but there are a lot of barriers standing in the way of rolling projects out,” she said.
“Labour shortages, access to water, sewerage, power and roads, union disruption, and red tape all significantly impact the final project cost and build time.”
“The proposed review will provide an opportunity for industry to be heard on perverse outcomes of recent changes that were introduced without proper consideration of the evidence and the implementation hurdles facing builders.”
