A textbook case of politics driving house prices.
Ok, so I wanted to look at an amazing policy backflip in NSW planning this week, but first, I know a few of you are interested in the art of persuasion, so let’s start with this gem from Opposition Finance spokesman Jim Chalmers. He’s complaining about the way the CBA activated a bunch of kiddie accounts without telling them, in order to juice their sales stats.
“These are appalling revelations and unfortunately also the sort of behaviour Malcolm Turnbull wants to reward with a $17 billion tax handout.
Labor wants to see the victims compensated for the rorts and rip-offs which are being uncovered, the Liberals want to compensate the perpetrators. Banks shouldn’t be rewarded for fiddling with kids’ bank accounts, they should be punished for it.”
Yep, he really went there. “Perpetrators”. “Fiddling with Kids”. The subtle cues are not so subtle. Banks = child rapists.
You might have thought that subtly evoking people’s anger at paedophiles was a step too far over the line. You’re probably right. But welcome to politics in 2018.
But while it’s poor taste, it’s brutally effective persuasion. Banks = kiddy fiddlers. The government (and the tax cuts) are their enablers.
As I’ve said before, it’s going to take something special to get these tax cuts through in this environment.
Malcolm, Morrison, I’m looking at you.
(…but not holding my breath.)
But let’s leave Canberra now for the Capital of modest and sensible, Sydney.
You might remember a few weeks ago that the NSW state planning body gave itself power over certain local government decisions in Ryde.
(Effectively it turned certain higher-density modifications into ‘complying developments’, fast-tracking their approval.)
Called ‘The District Plans’ they were only released in March this year and they called for 7,600 new homes in Ryde over the next 5 years. They also championed the ‘missing middle’ approach to providing terrace houses and duplexes as a way to increase density that is compatible with detached houses.
The 7,600 extra homes sounds like a lot, but we’re still barely scratching the surface of what’s needed. Still, it was a recognition that Sydney is growing fast and the housing stock simply isn’t keeping up.
And this is a point that everyone accepts. Sydney needs more houses. The only problem is, no one knows where to put them.
And Ryde certainly wasn’t happy about being the sharp-tip of the spear in the agenda to density Sydney. Nor was Canterbury-Bankstown.
The Mayor of Ryde was complaining to the papers that there’d be developers and “bulldozers of every block”. The Canterbury-Bankstown Council discussed the proposed changes just over a month later under the agenda item: ‘THE MISSING MIDDLE – A TRAIN WRECK OF A POLICY TOTALLY MISSING THE POINT’.
(Hard to tell what they were really thinking there.)
The local governments rallied hard on their constituent’s behalf.
The state government, facing a tricky election, decided to do a backflip. Now the whole thing’s on hold.
It’s just so classic.
Sydney’s population is booming, thanks in large part to an immigration intake that’s set at the Federal level. The greenies don’t want the city sprawling outward into bush and farmland. Existing residents don’t want to see their leafy streets being built upward, and everyone wants to complain about affordability.
Can you see a way out of that one?
Nope, you can’t. Because there isn’t one.
Unless one of those policy levers is shifted, higher and higher prices are baked in.
It’s driven prices over the past twenty years. It will drive prices over the coming twenty.
And we’ll still be complaining about housing affordability in 2040.
Isn’t that hilarious?