PRODAP RESIDENTIAL LAND AND PACKAGED HOUSING MARKET REPORT JUNE QUARTER 2007
(SAMPLE ANALYSIS ONLY)
Property Market News
Marina Quays Launched
One of the largest new communities ever seen on the Gold Coast was launched on 21 September 2007. This 100ha waterfront site has development potential for over 2000 dwellings, a 900 berth marina, and town centre comprising an urban village, retail and commercial space.
Developer John Fish has engaged architect Greg
Forgan-Smith, who will follow 'new urbanism'
principles in the design of a walkable community.
There are eight kilometres of boardwalks
proposed. It is also hoped that a rail spur from
Coomera can connect to the site within the next
five years. A total of 425 lots and completed
apartments went on sale on the weekend of 22-23
September, which should make a great deal of
difference to the September quarter sales figures
in our next report.
Urban Land Development Authority (Queensland)
In October 2007 the State Government will enact
the ULDA which will have powers to "assemble
land, assess and approve development and market
land for development by the private sector". The
purpose is to provide sites for affordable housing in
cases where the normal processes have
stagnated. ULDA will either acquire the property or
enter into a joint venture with the developer, and
will sell the site with approvals. The "profits" will be
ploughed into acquiring other sites, a path followed
by many a failed property developer.
The need for this drastic action highlights the shortcomings of IPA, the Integrated Planning Act (1997), which has been identified as the main cause of delays in rezoning approvals. It may have been easier and less expensive to amend IPA than to create another monster. This is a strange case of a Labor government acknowledging the shortcomings of its administration and duplicating what the private sector does best, i.e. identify, rezone and develop land.
Infrastructure Funding Is All Wrong
For years local Councils have recovered "headworks" charges by levying the developer his
proportionate share of marginal water storage and
sewerage treatment costs. The calculation was
based on forecasts of likely amplification of dams
and treatment plants within the city and pro-rata
that cost over new lots created over a certain time.
So all purchasers of new lots bore the brunt of
headworks charges. If you were fortunate enough
to have purchased an existing house or unit, you
escaped the headworks levy.
This distortion in the allocation of costs went
largely unnoticed until infrastructure charges skyrocketted
from $6,000/lot to $31,500/lot in the Gold
Coast this year. The increase has been factored
into new house prices, which had already
increased in price due to supply issues. Hence the
distortion in cost responsibility caused by the old"user pays" policy has implications for the housing
affordability issue.
A "whole of City" approach is needed for
infrastructure charges, even though a more
equitable policy may trigger higher Council rates
across the board. It may be politically unpalatable,
but then so is unaffordable housing. The
magnitude of rate increases could be modulated by
amortising the debt over the life of the asset (in
some cases 100 years) and recognising the future
income stream derived from the asset.
Infrastructure Charges For a Detached House by Selected LGA:
| LGA | Total Charges |
| Gold Coast | $31,540.31 |
| Brisbane | $24,000.00 |
| Noosa | $21,358.90 |
| Logan | $18,048.38 |
| Maroochy | $17,038.00 |