Politicians are talking about what they believe is a split housing market, while investors flock inner-south for the winter
The worsening housing affordability crisis in the nation’s capital has prompted the ACT government to announce plans to help level the playing field between what it is describing as two separate Canberras: double income professional families inhabiting the top 50% of the market; and everyone else.
ACT Economic Development Minister Andrew Barr recently fronted a Territory Assembly Committee, where he claimed that any recent undersupply in housing has been at the cheaper end of the market, placing pressure on potential buyers that have been priced out of more desirable areas.
He plans to introduce around 18,000 new residential blocks to the market in the next four years and says the government will step up intervention in the housing industry.
Barr said his gut feeling is to lean towards having an oversupply of affordable property available, to ensure the product is always ready for release if the market is confronted with a spike in demand.
Real Estate Institute of the ACT president Michael Wellsmore says that government intervention in property is nothing new, due to its ownership of most of the land in Canberra.
“The government owns the land in the ACT because most of it is on 99- year leases,” he says. “Land is produced in three ways in the ACT. The government develops it as a green field; the government enters a joint venture with a private sector company; or it sells off the land to private developers.
“An undersupply of housing in the last five years has been expressed in very significant house price increases,” he continues. “The supply is beginning to catch up now because the government has been pumping out twice as much land as the market requires in recent years.”
Tale of two CBDs
Wellsmore says Canberra essentially has two centres, the actual CBD and the parliamentary triangle. A new development on the parliament side is attracting some attention. “The most popular area is the inner-south, and now it has the Kingston Foreshore development,” he says.
The development will comprise around 1,800 dwellings and serviced apartments, as well as retail, commercial, cultural and recreational facilities. It is situated on the banks of Lake Burley Griffin and close to rail transport and the Jerrabomberra Wetlands.
“The inner-south is where a lot of redevelopment has occurred over the last five years,” says Wellsmore. “Huge numbers of people are employed in that area and the highest demand is always there.”
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