There were mixed reactions to Lord Mayor Adrian Schrinner’s Housing Incentive Plan announced yesterday. The Property Council and Brisbane Housing Company welcomed the proposal to provide significant financial incentives to private and community housing providers, but others ask, “at what cost to rate payers?”. Labor Leader in Council Jared Cassidy and Greens Mayoral candidate Jonathan Sriranganathan were among those querying the plan. Local economist Dr Cameron Murray estimates costs of $180 million, City and Social Planner Dr Laurel Johnson and the West End Community Association have slammed the proposal for transferring responsibility for infrastructure costs from developers to ratepayers.
The plan, introduced before a Property Council Lunch, aims to speed up the construction of affordable housing in Brisbane to manage the city’s fast growth and housing needs.
Key Points:
- Measures: The Lord Mayor’s Housing Supply Action Plan introduces incentives by reducing infrastructure charges and relaxing height and car parking requirements. These changes will primarily apply to inner-city and high-density zones, especially those near shopping centres and the inner city.
- Plan foundations: The Plan builds upon the Council’s existing measures to counter the housing crisis. Notably controversial initiatives like the Kurilpa Sustainable Growth Precinct Plan.
- Housing Demand: Brisbane’s status as Australia’s fastest-growing capital city highlights the urgency of addressing housing demands. The State Government’s draft South-East Queensland Regional Plan projects a need for approximately 8500 new homes annually to meet demand.
- Economic questions: Economist Dr Cameron Murry says the plan will cost Council $180M and suggests alternative ways to spend funds.
- Community Response: West End Community Association has queried why Council is prioritising developers over residents and doubts the plan’s effectiveness in speeding up approved projects.
Implementation and Timeframes:
- Immediate Eligibility: Around 3000 fully approved projects within designated areas that are not yet under construction will immediately qualify for a 75% reduction in infrastructure charges.
- Completion Timeframes: Approved projects must be completed within four years from today to access the 75% reduction. New projects need approval by June 30, 2025, and must be completed within four years from approval to access the 50% reduction.
Queried about time-frames for new housing, Cr Schrinner said, “if we don’t do something different. If we don’t act, we will see the housing crisis get worse and worse.”
Cr Schrinner said only 724 apartments were built last year, “not because new approvals were down, it is because the feasibility was not there, and the costs were too high to go ahead,”
He said developers are “parking” their projects because they are not feasible.
“Hopefully this together with support from other levels of government will make those projects feasible. And get those projects back on track.”
Stakeholder Responses:
Private Sector:
The Lord Mayor says the private sector plays a critical role in building homes in Brisbane, and the incentive plan aims to encourage industry participation by reducing infrastructure charges for eligible projects.
The Property Council of Australia Queensland Executive Director Jen Williams said infrastructure charges form a significant component of the delivery cost of new homes, and the Property Council applauds Brisbane City Council for the initiative.
“This welcome reduction in the input costs of construction will go a long way to getting more homes on the ground, sooner.”
Community Housing Sector:
Community housing provider the Brisbane Housing Company also commended the plan.
Chief Executive Officer of the Brisbane Housing Company, Rebecca Oelkers, said the plan will be a game-changer for community housing providers.
“Relief from infrastructure charges shifts the dial for community housing developments and will directly result in new homes being delivered to assist Brisbane residents in housing need,” Ms Oelkers said.
Political Responses:
Labor leader Councillor Jared Cassidy acknowledged the need to focus on affordable housing delivery and welcomed the relief to the community housing sector, which he said Labor has been advocating for. But, he said, the Mayor’s offering is, “too little, too late.”
“We’re glad that he [Cr Schrinner] is finally doing something on that front. But one thing is clear – we need a council that has a laser like focus on the delivery of housing in Brisbane.“
“Whether we should be giving free money to private developers, is a very important question that people have reasonable need to consider. There are lots of options that should be on the table around ensuring that what is approved should be built and if those developers are not going to build their approved developments, maybe they should be penalised.”
Cr Cassidy said that Labor still needs to see the details of the plan.
Greens Mayoral Candidate Jonathan Sriranganathan, who announced one of The Greens ideas for affordable housing on Wednesday, labelled the plan “short-sighted and financially irresponsible”.
“Currently developers are not contributing enough towards the cost of new infrastructure to cater for new developments.”
“The real reason that we’re seeing a delay in projects coming online is that developers and speculators are holding off while they wait for the property values to rise. They could start building tomorrow if they wanted, but they know that if they wait a few days, property values will rise higher and they’ll make bigger profits,” Mr Sriranganathan said.
Economic and Community Reactions:
West End-based economist Dr Cameron Murray said that economically, the proposal is equivalent to paying property developers more than $10,000 in cash for each home they will build in the next five years, including paying those who have postponed projects with approvals for the past year.
“If the same number of apartment completions occur in the next five years compared to the last five, the policy would cost the city roughly $180 million.”
“The housing policy question is whether this changes how many dwellings are built, and the answer is unclear.“
Dr Murray said an alternative way to spend $180 million is to use the money to directly build new homes and rent them at subsidised rental prices. “This guarantees that more homes are built.”
“For the price of this policy, nearly 400 dwellings could be constructed. These dwellings would then be an asset that would earn rental income and grow in value for the city and fund more homes in the future. “
“Australians know the value of investing in housing, so it is strange that the Brisbane City Council prefers to subsidise others’ housing assets with an uncertain effect on the rate of new home production.”
Community Response
Seleneah More, President of the West End Community Association (WECA), which has been campaigning against Council’s Kurilpa Sustainable Growth Precinct Plan, said:
“Brisbane City Council has cried poor when it comes to providing essential infrastructure like pedestrian crossings, bike lanes, parks, libraries for our neighbourhood as it tripled in population over 15 years. Now they are stripping the revenue (infrastructure charges) and increasing land value through zoning uplift. It’s gifting to the developers.”
“Whether you live in social housing or luxury units people need infrastructure and someone has to pay. It is a short-term politics that passes the cost onto future generations and erodes liveability in urban neighbourhoods.”
Ms More queried whether the new plan will speed up the delivery of nine approved towers and 1748 units (4370 beds) in the Kurilpa Precinct.
“Probably not because it is all reliant on market conditions.”
Perhaps the most stinging response was from City and Social Planner, Dr Laurel Johnson who said Council is once again tangling the issues of housing supply and housing affordability to maximise the profits for a few.
“It’s a basic fairness test for any city that new developments will pay their share of the costs of the public and shared infrastructure that they use.”
“How is it fair for developers in inner city locations who make good profits from apartments to have the costs of local infrastructure paid for by the existing residents from Wynnum to Sandgate to Forest Lake. That’s not fair.”
“Are the people of Brisbane prepared to pay for the costs of providing local amenities for buildings that they and their children can never afford to live in? This isn’t social or community housing, it is private housing with a big price tag”.
“Brisbane is supposed to be a New World city. What standard is the City Council setting if we expect the existing residents to subsidise the development of very expensive apartments?”
“The city’s budget surplus should be used to invest in public amenities for the city, not to subsidise high value private developments.”
Details of the Plan:
Infrastructure Charge Waivers:
- A 75% reduction in infrastructure charges for studio, one, and two-bedroom apartments within inner-city, high-density areas with existing approval since January 1, 2022.
- A 75% reduction for studio, one, and two-bedroom build-to-rent apartments with existing approval since January 1, 2022.
- A 50% reduction in charges for studio, one, and two-bedroom apartments within inner-city, high-density areas approved from September 1, 2023, onwards.
- A 50% reduction for studio, one, and two-bedroom build-to-rent apartments within inner-city, high-density areas approved from September 1, 2023, onwards.
- A 100% permanent reduction for registered community housing providers.
Brisbane council from 2014 made it much more difficult to get units and townhouses built as they felt there was an oversupply and introduce policy to reduce how many were being built. They called this the Brisbane Blueprint. Now they are reversing some Of their own previous policies and calling that progress.
This will have no impact whatsoever ever, partly because buildings were either already going to be built or won’t be built anyway due to the lack of builders and cost of building.
Every policy like this seems to always benefit just the very large development companies who are political donors and lobby the council on a regular basis. There never seems to be grass roots policy aimed at where most Housing comes from, which is small scale infill development .
The other argument is alway, “we should use money to build social housing”. This makes no sense as the money dose not exist, it’s tax money on housing that is not being built therefore was never going to be collected. People saying we should increase taxes on housing so there will be more housing , just does not make sense.
More spin from this Council. They can line the pockets of developers and make it look like they are actucllay doing something to address affordability when they are not. I totallt agree with the critiques from the housing experts on this one. The state government should call the Council out on this and demand that they genuinely address supply for the long term I agree with Cameron Murray. Let Council take the money and directly invest it in housing rather than pretending to do it through a process to benefit the development industry. They also have to explain how reducing infrastrucure charges will affect the delivery of other critical infrastructure in the city.