02/09/2010 - 00:00

Infill targets need incentives: UDIA

02/09/2010 - 00:00

Bookmark

Save articles for future reference.

THE state government will have to provide more incentives for developers to reach density and urban infill targets set in the new state planning framework, Directions 2031 and Beyond, according to the Urban Development Institute of Australia.

Infill targets need incentives: UDIA

THE state government will have to provide more incentives for developers to reach density and urban infill targets set in the new state planning framework, Directions 2031 and Beyond, according to the Urban Development Institute of Australia.

Planning Minister John Day released the final planning framework early this week, and also released detailed planning strategies for central and outer metropolitan Perth for public comment.

A key aspect of the plan is the government’s target of 47 per cent of new residential land to be developed in established urban areas, a reduction from the 60 per cent targeted in the Carpenter government’s previous planning framework, Network City.

Current urban infill in metropolitan Perth is between 30 and 35 per cent of all new residential development.

Property Council of Australia executive director Joe Lenzo said the plan had arrived just in time to meet the expected growth of metropolitan Perth, catering for a forecast 550,000 additional people requiring 328,000 new dwellings by 2031.

Mr Lenzo said Directions 2031 and Beyond recognised the role of developers in achieving the infill target, and said the 47 per cent objective was achievable if the private sector was willing and able to invest in higher-density housing.

But UDIA chief executive Debra Goostrey said incentives would need to be put in place for the targets to be met.

“Infill development is proven to be much more expensive than greenfield development due to higher construction costs and infrastructure upgrading requirements,” Ms Goostrey said in a statement.

“If there is no incentive such as a tax break to take on this kind of risk associated project, why would a developer do it?

“It is also likely to cost new home buyers at the end of the day if product is more expensive to develop.

“While UDIA agrees that an increase in infill development is required to sustainably accommodate growth, it is not going to happen without appropriate mechanisms in place to entice development companies to get on board.”

Ms Goostrey also noted that inadequate land had been identified to reach the infill targets across 19 local government areas in central metropolitan Perth that will have to fit in at least 121,000 new dwellings by 2031.

According to the central metropolitan Perth strategy, there are currently 7,660 vacant lots on residential zoned land across the 19 local government areas.

Ms Goostrey said previous state governments had stated goals to increase urban density and infill development, but low-density dwellings continued to constitute two thirds of all recent building approvals.

“This shows an obvious need to do more than set aspirational goals,” she said.

Inner-city real estate specialist Limnios Property Group chief executive, James Limnios, agreed the infill targets were a major challenge, and said financial incentives for property buyers to buy homes in the inner suburbs could be a viable alternative to tax concessions for developers to meet the infill targets.

“The state government could introduce a number of incentives to encourage thousands of Perth residents to live in the inner-city area, including cutting stamp duty on second hand property purchases for owner occupiers by 50 per cent, and 100 per cent cut to stamp duty for buyers purchasing apartments off the plan,” Mr Limnios said.

“Stamp duty concessions have been used in other developed countries such as the UK, as well as in Melbourne, to regenerate neglected areas which suffered declining population.”

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options