Housing has been one of the major issues throughout this year’s state election campaign. And much has been said about what needs to be done to resolve it.
There is no doubt that Tasmania is facing a crisis in housing. House prices are rising at an extraordinary rate and many people are being squeezed out of the market.
In one sense, it is a classic tale of demand outstripping supply. There are more people wanting to buy houses than there are houses to buy.
Investors have entered the market and are buying up big. The low interest rates, resulting in low returns on capital invested, have encouraged more people to look at property as an investment that can provide a good return.
Many of these investors are from the mainland. For them, the Tasmanian market is an easy choice as it is often significantly less expensive than their ‘home’ market where prices are even higher. The issue of some concern here is that they are not selling to buy, instead just buying, and are consequently soaking up the available housing stock.
Adding to the demand paradigm is the low interest rate regime and other forms of government support, enabling people to borrow who otherwise would be in no position to do so.
Until recently the government has been disengaged from the problem, believing the private sector can manage the swings and roundabouts of the market, with not-for-profit organisations being encouraged to manage the increase in demand for social housing.
However, as the social consequences have become more politically sensitive, government has become more strongly engaged and is providing support for builders to build, and now talks of a construction-led recovery.
One of the critical issues that has not been addressed in this debate is the role that planning has played in allowing the housing shortage to occur.
One cannot just go out and build a house.
Planning laws, zoning laws and the myriad regulations surrounding them ensure that development can only occur at a snail’s pace. While town planners and traffic academics argue over whether inner city and infill development is a more preferable option, housing developments continue to occur in the outer suburbs. However, both options are constrained.
Making land available for housing can involve zoning issues associated with change of use, and as such can take time to resolve. Even the government’s own social housing projects are being held back by some prescriptive development requirements.
Although there has been an effort made over the last few years to establish a state-wide planning system, and with some success, individual councils still have discretion over what can and cannot occur within their boundaries. This has led to significant confusion and frustration.
Steering through this involves a working knowledge of both the state-wide Tasmanian Planning Scheme and the various and diverse local planning provisions. Many councils are still being managed under interim planning schemes while final schemes are being drafted and assessed.
One of the constraints in releasing land for subdivision, is the zoning provision known as the Urban Growth Boundary. It was designed to reign in urban sprawl, but over time has become a barrier to the release of land, thus causing an artificial increase in land value. As cities grow and change, so also should the zoning provisions.
The Urban Growth Boundary was largely designed to encourage inner city infill. As much as this might be appropriate, if higher density living is to be encouraged, then the essential other side of the coin is to ensure a greater flexibility in its design elements. Otherwise, it simply encourages a landscape monotone and becomes self-defeating.
Although provisions are indented to legislate for good design, but these are always doomed to fail because it has become a race to the bottom in terms of over-prescribing what can and cannot be done, leaving little, if any, discretion to the developer.
A recent Ministerial Directive came into being earlier this year with minimal prior consultation, and contains rules surrounding exemptions and requirements surrounding Interim Planning Schemes. It is 56 pages long and is extremely complicated to follow.
Matters that come before the Planning Appeal Tribunal have to follow certain procedures, and the practice directions for doing so are over 80 pages long.
What was meant to make decision-making easier and quicker has now become a battleground for lawyers. This has led to further expense and delay. In fact, the planning rules generally have become so obtuse and difficult, it requires a lawyer skilled in planning law to steer the way through the morass of legislation.
And as Justice Alan Blow said 10 years ago, when referring to Kingborough’s former planning scheme,
“The planning scheme is very complex, and exceedingly and unnecessarily difficult to comprehend or interpret”.
And further on:
“Most ordinary people would not have a chance”. “It is practically essential to have a law degree, decades of experience in interpreting legal documents… and a very strong capacity for perseverance”.
It should not be like this. While housing is taking centre stage in this election, the controlling entity behind the problem is the restrictive planning provisions, and these must be addressed if the housing crisis is to be resolved.