Draft Greater Sydney Region Plan

Transcription

1 Draft Greater Sydney Region Plan Submission_id: Date of Lodgment: 28 Dec 2017 Origin of Submission: First name: Rick Last name: Banyard Suburb: Submission content: I welcome the opportunity to make a submission on the Draft Greater Sydney Region Plan and revised District Plans. I am concerned by targets that are by all accounts are too low to put a real dent in the growing and urgent need for affordable housing and there is no clear timetable or strategy for their introduction. Without a clear plan to address the housing needs of the people of NSW the community will be embroiled in a level of stress and uncertainty that is simply unacceptable. Social and affordable rental housing must be addressed and solutions found. I recognise that the GSC alone cannot solve the affordable housing crisis - a whole-of-government approach is crucially needed. It is clear that the influence of the GSC is potentially very influential. There is simply not enough housing that is available for people on low to moderate incomes housing that is also stable, well-located (close to jobs, public transport, educational, health and other services), appropriate (for family size, disability, ageing, cultural and other needs), safe and enabling. Low to moderate incomes is the majority of the population in NSW. The key recommendations for the Affordable Rental Housing Target (ARHT) scheme as proposed will fail. Affordable housing is a phrase that has many different meanings. Some core meanings include:- 1. The level of funds a home purchaser has available to secure a property that meets their needs. Generally

2 this includes borrowed funds. 2. The level of funds a home purchaser has available to secure a residential rental property that meets the needs of tenants and provides an acceptable level of viability. Generally this includes borrowed funds. 3. The level of funds a tenant has available to secure a rental home and make rent payments that meets their needs. A home includes freestanding houses, villas, units, apartments and all other combinations in which the occupier establishes a residential household for a period of 6 months or greater. The percentage of funds borrowed is a measure of affordability for most households. The lower the equity level the greater the housing stress of the household. The ability to service debt is also a major stress factor and impacts heavily on affordability. Death, divorce, accidents, rezoning, floods, fire and earthquakes and many other external factors can rapidly plummet the financial stability of a household. Home owner are now under real affordability pressure. The very high price of housing is preventing many from entering (or upgrading) the owner occupier sector. The net result is that they either overextend or remain in the rental market. The tenants only equity in their house is their ability to pay rent. A large proportion of tenants have very limited income either due to being low income earners of because they are social housing beneficiaries. Rents are rising at a much faster rate than incomes. Incomes are not rising. The only light in the tunnel is that employment levels are rising however employment income often replaces or reduces social security benefits. The most important group that has a major impact on affordable housing is the owners of rental property. The housing provider group is broadly divided into four sectors:- Firstly the government and semi government housing sector. This sector has a track record of not being able to meet the needs of the social housing clients. The ever climbing waiting list, the lack of growth of housing stock and the serious decline in the state of repair are clear proof that the government and semi government providers are not capable. Secondly there are corporate housing providers. This group provides accommodation to both tenants and owner occupiers. There motive is profit from development

3 opportunities. If the market is good they sell. If not they hold properties as tenancies until sales can be achieved. These properties tend not to provide for social housing needs although may take advantage of tax incentives and affordable housing strategies. Normally properties held by corporate housing providers are not good options for long term renters. Thirdly there are property developers and investors The ownership of land is simply for the purpose of making money by either resale after a short period of after land development projects. Tenants are simply a means to offset some of the costs of holding the property. In almost all cases the property is demolished or partly demolished. Tenancies are of uncertain duration and there is very little incentive for the owner to maintain or improve the property. The fourth ownership sector is the dedicated Landlord. This group is a major provider of homes in almost every street in Australis. Typically these providers have between one and five homes with few owning more than twenty. Landlords in this sector are commonly referred to a investors. This tag is totally false. Just as a service station owner is not an investor, a fish shop owner is not an investor, a hotelier is not an investor and boarding house owner is not an investor it is totally unacceptable to tag Landlords as an investors. Dedicated landlords are in the business of providing long term accommodation to tenants under a Residential Tenancy Act lease. If the Commission is committed to provide all types of housing it must:- 1. Not be conned into the concept of building affordable housing 2. Not attempt to control house prices for owner occupiers or tenants 3. Not lower the standard of housing 4. Must insist on the housing costs to be considered on a whole of life basis 5. Must commit to a redraft of the Residential Tenancies Act and similar in order to make it attractive to own and lease out residential rental property The reason for the above strategies are detailed below:- Not be conned into the concept of building affordable housing The creation of various levels of housing is to create discrimination and inequality. Thankfully we have moved away from building housing commission estates as these were a social and residential disaster. To create lesser class dwellings within a housing complex is not good and

4 generally provide for the occupation of the less desirable premises within the complex by the affordable housing tenant. Frequently these are smaller than other premises. Not attempt to control house prices for owner occupiers or tenants Property prices always find natural levels over time as there are many external factors that other than the building cost that influence the purchase value of a property and or rental value. Not lower the standard of housing All housing should be the best design possible. Efficiency, durability, flexibility and building integrity should be high. Building products should be long lasting and fit for purpose. Buildings should not be over engineered or over certified. Must insist on the housing costs to be considered on a whole of life basis Many houses are built cheap however the desire for low cost has a significant negative impact on the length of life of a property. Early houses in NSW had a life expectancy of 100 to 150 years. Now many will be lucky to last 40 years. Fixtures including heating, cooling, insulation, Led lighting, solar electricity and solar hot water have the potential to reduce whole of life costs. These fixtures also make it cheaper for tenants to occupy the rental property. Must commit to a redraft of the Residential Tenancies Act and similar in order to make it attractive to own and lease out residential rental property. The Residential Tenancies Act is a major deterrent to providing rental housing and seriously disadvantages landlords. The Residential Tenancies Act is a totally inappropriate piece of legislation for the regulation of investment properties and short term rental properties. Many investors are simply property speculators and or developers. Tenants are not the focus of their investment. The Residential Tenancies Act should be confined to the regulation of property owners in the business of being Landlords. The Act should provide for the long term owners of rental properties to reasonably and fairly manage their properties and to offer tenants quiet enjoyment with a reasonable level of tenure security. In order to provide an adequate volume of rental property on the market the rent needs to be adequate to provide viability, the ability to fund repairs and maintenance and a return on capital invested in the business of being a Landlord. The

5 Powered by TCPDF ( return on capital must be competitive with other forms of investment like shares, gold, non-residential property and other forms of business. A redraft of the RTA would be the most productive initiative the Greater Sydney Commission could do if it is genuine in accommodating households into premises that are closely matched to the needs of the community. I believe it would also be useful, particularly to tenants, to have the social security and assistance measures provided for housing to be examined and adjusted. The emphasis should be on:- Exempting long term residential rental property from Capital Gains tax. (eg exempt after 10 years). Reducing housing construction paperwork costs. Subsidising the installation of solar and other operational cost items in a house. Eg by exempting the items from GST. Increased rent assistance measures including:- o The payment of rent assistance funds direct to the landlord o The provision of housing vouchers to low income renters and lessees o A higher tax free threshold for lessees I commend my submission to the Greater Sydney Commission and advise that I am more I am more than happy to support my submission in person or by other means.