New Housing Minister Bill Marmion has shocked the property market by saying he wants to flood WA with housing lots to cut home prices.
In a speech to Parliament that has set alarm bells ringing throughout the real estate industry, Mr Marmion said the Barnett Government’s aim was to “bring house prices down”.
“The Department of Land is looking at this issue very closely,” he said.
“It owns land and it is looking at its land stocks and will release as much land as possible.
“That will reduce the pressure on housing supplies. Our aim is to bring the median house price down and to have it lower than the median house price in other States.”
Mr Marmion, who took over the job last month after Troy Buswell was sacked, said the only thing the Government could do to achieve its aim was “release more land and houses”. He refused to elaborate on his comments yesterday.
March quarter figures from RP Data put the median house price in Perth at $480,000, equal to Darwin, but behind Sydney ($500,000) and nation-leading Canberra ($510,800).
Hobart had the cheapest prices in Australia at $323,750.
The State Government established an Office of Land and Housing Supply in Thursday’s Budget and is reviewing available government land which Premier Colin Barnett said would “achieve a comprehensive and co-ordinated approach to housing affordability issues”.
Shadow housing minister Mark McGowan warned the policy could result in houses being worth less than what people paid for them.
“If people go into negative equity with their house, that’s the worst possible outcome,” he said.
Real Estate Institute of WA chief executive Anne Arnold said Australians stored their wealth in the family home and it would be “politically unwise for any government to go down that path”.
But the plan won support from developer Nigel Satterley, who said land needed to become more affordable.
But he said the policy would not cut the price of existing houses.
“We’re on the cusp of a block shortage and whatever the Government can do should be encouraged,” Mr Satterley said.
Analysts at RP Data found in April that houses in Perth’s cheapest suburbs cost at least $60,000 more than those in the most affordable areas in the other major Australian cities.
Hillman was named the cheapest suburb in Perth, with a median house price of $280,000 – higher than the cheapest suburb in Adelaide ($200,000), Brisbane ($205,000), Melbourne ($218,000) and Sydney ($219,000).
Perth had less than 10 per cent of its 259 suburbs with a median house price under $350,000, compared with more than 20 per cent in all other big cities.
Blocks of land in Perth were the most expensive in Australia, according to a recent analysis by RP Data and the Housing Industry Association, with a single square metre of “prime earth” now costing an average of $521.
Source : www.thewest.com.au
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