Infill prices killing the dream of owning a house

Share Canberra's trusted news:
Cartoon: Paul Dorin

“For almost a decade the government has strangled the supply of land for standalone housing in favour of units and apartments. It’s all a part of the Labor/Greens’ dream that 70 per cent of new dwellings must be urban infill,” writes MARK PARTON

IT’S worth looking back at Canberra’s growth over the past decade and asking the question: have the Labor/Greens government’s land-release policies created an underclass of Canberrans who have no choice but to live in a flat, unit or apartment?  

Mark Parton

In November, the “Domain House Price Report” showed that the gap between median house prices and median unit prices was 83 per cent.  The median house price in the ACT is $817,810, the median unit price $447,143 – which is a gap of $370,667. 

This compares to 37 per cent in 2011. In March that year, the median house price was $566,709 compared to a median unit price of $413,929.

Between September, 2011, and September, 2020, median house prices in Canberra grew by an annual average of 4.34 per cent, while median unit prices only grew by around 1 per cent. If we extrapolate these growth rates out for a further 10 years, median house prices would be $1.25 million and unit prices would be $493,924 – a 153 per cent difference!

So why has the gap grown so much? 

It’s primarily a result of the Labor/Greens government’s land-release policies.

For almost a decade the government has strangled the supply of land for standalone housing in favour of units and apartments. It’s all a part of the Labor/Greens’ dream that 70 per cent of new dwellings must be urban infill. As such, demand for houses is outpacing the supply of houses, forcing prices up. 

The motivation for the current land release policy is to minimise Canberra’s urban footprint. Hard to argue with saving the environment, but it’s also hard to argue that the ACT is land constrained like, say, Hong Kong or Manhattan.

And, it’s also easy to arrive at the conclusion that these policies were designed to maximise land-sale profits for the government at the expense of struggling first-home buyers. The environmental argument loses some steam when you consider how many aspirational families are commuting much longer distances into our city after being forced to purchase their standalone homes in Googong, Jerrabomberra, Murrumbateman and Bungendore.

The ACT government’s own study, the “Winton Report” in 2015, showed that more than 90 per cent of people wanted the next dwelling they live in to be a “separate” dwelling. Apartments are great when you’re in your twenties and might not yet have a family. Apartments are also great if you are older and have no dependents.

But life is a long journey and Canberrans are diverse. Many people aspire to have children, and almost all of us have been raised to believe there is a dignity in aspiring to actually owning your own home (ie a house). One hundred per cent of the “Winton Report” respondents who were “pre-children” wanted their next home to be a separate dwelling.

With such a material gap between unit and house prices, the well-worn path of buying a unit and then upgrading to a house after a few years off the back of some capital growth, no longer appears to be an option for an increasing number of people in Canberra. 

Will the ACT’s land-release policies mean that in years to come kids in the school playground will talk about people being “housos” or “toweries”? “Housos” ironically once being a derogatory term for someone living in public housing could become a status marker in Canberra. 

Increasing homelessness and increasing demand for affordable rentals in the ACT is a sign that something isn’t right, particularly when Melbourne and Sydney are seeing the reverse trend.  

Why compound the indignity of not being able to afford the rent on a house by forcing people into apartments as well. Or even worse into homelessness.

One potential solution would be for the government to allow genuine urban infill common in every major city in Australia – that is, separately titled “semi-detached” or “dual-occupancy” properties.  

From a preference standpoint, a “semi” is arguably no different from a house. Allowing it to occur on a selection of Mr Fluffy blocks in recent years has shown it is viable. 

There are more than 70,000 residential blocks in the ACT larger than 700sqm. This creates boundless opportunity to address the undersupply problem of detached or equivalent housing.

Separately titled, dual-occupancy properties would not increase the urban footprint and, crucially, the market will decide how much development occurs.  

Those struggling to get on the home-ownership merry-go-round have a right to be displeased with Labor and the Greens. We are at a genuine crossroads as a city and here’s a potential path that would lead to much better housing outcomes for many more Canberrans. We don’t want to end up with the chronic homelessness problems of somewhere such as San Francisco.

Mark Parton, a Liberal MLA for Brindabella, is the opposition housing spokesman.


Who Can You Trust?

In a world beleaguered by spin and confused messages, there's never been more need for diverse, trustworthy, independent journalism in Canberra.

Who can you trust? Well, for more than 25 years, "CityNews" has proudly been an independent, free, family-owned news magazine, serving the national capital with quality, integrity and authority. Through our weekly magazine and daily through our digital platforms, we constantly and reliably deliver high-quality and diverse opinion, news, arts, socials and lifestyle columns.

If you trust our work online and believe in the power of independent voices, I encourage you to make a small contribution.

Every dollar of support will be invested back into our journalism so we can continue to provide a valuably different view of what's happening around you and keep free.

Click here to make your donation and you will be supporting the future of journalism and media diversity in the ACT.

Thank you,

Ian Meikle, editor

Previous articleLetters / Northbourne’s ‘unsightly’ entrance to the capital
Next articleThe Pop Inn parties to toast turning four

Leave a Reply