MacTiernan hits back on charges

Planning and infrastructure Minister Alannah MacTiernan has labelled a report from the residential arm of the Property Council of Australia as "intellectually dishonest" for depicting government charges on new housing as an enemy to first home buyers.

The comments were made to a capacity crowd at the Urban Development Institute of Australia's luncheon today where Ms MacTiernan addressed issues relating to land availability, sustainability and housing affordability.

Produced by the Residential Development Council, the report highlighted Government taxes, charges and compliance costs and their impact on housing affordability in WA.

The report found that in Western Australia, Government related charges on new housing and unit packages have risen by 325 per cent in the past five years.

Ms MacTiernan said government charges on home-buyers were an investment in infrastructure, including everything from the provision of water, sewerage and power to a development site as well as the cost of building a decent product.

"What wasn't reflected in the Property Council document was that it actually costs Government to build roads, rail systems, upgrade energy and water systems. We must have the resources to do that," she said.

The council commissioned Urbis JHD, a leading independent planning and economic consulting firm to review the current cost structures for the development of new housing and to identify the rate at which these cost structures have escalated over the past decade.

Findings have disputed conventional thinking that housing prices are primarily driven by issues such as interest rates, supply and demand, and consumer confidence but reveal Government costs as being the second largest component of the final cost for new housing buyers, even ahead of the price of land.