The NSW Government is charging councils and community housing providers market rates to build affordable housing on unused land – a policy critics say contradicts the Government’s pledge to address the housing crisis across the state.
Griffith City Council was forced to pay $760,000 to build 20 affordable housing units at Dave Taylor Park, even though the land was no longer being used by its previous owner – the state-run NSW Land and Housing Corporation.
Mayor Doug Curran said the council would also like to build units on unused Crown land (State Government owned) at Kookora Street, but has been told it would have to pay market rates to do so, substantially increasing the costs of such a project.
The council has been partnering with community housing providers to build dwellings to address a chronic rental shortage across the town, and while they have had some success, the cost of unused state land has proved a significant barrier to their goals.
“There is a Treasury direction that requires that the sale or lease of Crown land should ordinarily occur at market value,” a spokesperson for the NSW Crown Lands department told Region. “Any proposed departure from the policy requires the consent of the Treasurer.
“In relation to Kookora Street, Crown Lands has advised the council it is happy to work with it to achieve its objectives regarding use of the land for affordable housing and has advised it on the steps required.”
The longstanding Treasury policy of charging market rates for unused land has continued under the current NSW Labor government, despite its stated commitment to address what it calls a “housing supply crisis” in NSW by “identifying surplus public land that can be rezoned for housing and associated uses” and “incentivising an affordable housing component in private developments on private land”.
According to the Community Housing Industry Association of NSW, the peak body representing social housing providers, there is a shortfall of more than 200,000 affordable and social houses across the state. In Griffith, less than one per cent of rentals are vacant, increasing demand for homelessness services.
NSW Greens Housing and Homelessness spokesperson Jenny Leong MP says the government policy of charging market rates for unused land does nothing to ease this crisis.
“There is so much that is broken with the NSW Government’s approach to housing – the current approach even requires the Government’s own housing department to pay market rates for land owned by other government departments,” she said.
“Market solutions won’t solve market problems, this is a clear example of why we need to get the profit motive out of housing.
“Further commodification of land isn’t the way out of the housing crisis, it’s time for the Government to step up, invest real money in public housing and impose requirements on all private development to have genuinely affordable housing in perpetuity.
“The Greens want to see more public and genuinely affordable housing across NSW, but this must never come at the cost of privatising public land.”
Economist and housing expert Ben Spies-Butcher said he would like to see Australia follow the lead of many European countries, where governments offer unused land for free or at below market rates to enable affordable housing to be built.
“Paris, for example, has achieved enormous gains in affordable housing … in NSW, one of the things that Treasury does is compare things to market value, which can create a bias in favour of market imperatives and against social ones.”
Mr Spies-Butcher said there was once a time when governments in Australia took pride in owning assets, and sought to see how these assets could be put to their best community use. He said nowadays however, everything was geared towards market valuations and privatisation.
“We no longer have the structures in place [to build large-scale affordable housing] … the whole system has completely fallen apart.”
Original Article published by Oliver Jacques on Region Riverina.