As Western Australia grapples with a critical housing supply shortage that is threatening longer term affordability, the Urban Development Institute of Australia (UDIA WA) has launched a new report that sets out four clear recommendations to enable the State Government and industry to work together and act now to avoid a crisis.
UDIA WA chief executive Tanya Steinbeck said: “Housing supply and affordability are one of the key issues that impact on every West Australian.
“Perth is one of the most affordable cities in the country with a very enviable lifestyle, but if we don’t act now, that position will be lost.
“We can see it slipping through our fingers every time we see the news outlining real estate price rises, record low rental vacancy rates and construction timeframe blow outs.
“Our new report lays out the current situation, clearly showing that we only have six years of supply left in current major greenfield projects.
“That diminishing greenfield supply is exacerbated by low infill development yields that will fail to meet increasing demand at the current rate.
“Most infill development is just not stacking up for developers right now.
“Many projects have been put on ice due to critical worker and material shortages coupled with a range of long-standing issues that challenge the delivery of quality infill development.
“The latest Urban Growth Monitor produced by the State Government shows we are considerably behind the urban infill targets set by Perth and Peel @ 3.5 million and that is no surprise considering the current climate.”
UDIA WA’s new Housing Ready report is focused on ensuring a pipeline of affordable supply through four key recommendations.
The report follows on from last year’s Housing our Community report that provided a comprehensive picture of Perth’s housing supply as at June 2021.
Steinbeck said: “Since the release of last year’s report, the State Government has made some moves to address our concerns.
“It was encouraging to hear the Premier acknowledge land and housing supply as a major issue in his State Budget presentation last month.
“But more needs to be done and the work needs to start now.
“This latest report takes into account the changing economic, social and environmental landscape that we are currently navigating.”
Four key recommendations for the State Government in UDIA WA’s Housing Ready Report:
1. Work with industry to develop & agree on an accurate, single source of truth on housing supply.
2. Create a collaborative governance framework to facilitate and ensure delivery of a development ready pipeline.
3. Commit and urgently progress a strategic environmental assessment to release the blockages to development ready land.
4. Work with industry and local government to establish an agreed lead infrastructure program to unlock housing supply across Perth and Peel.
THE DETAILS:
Greenfield Development
There is only six years’ worth of supply in the current greenfield development pipeline.
66% of urban deferred land in Perth and Peel is identified as Bush Forever – precluding residential development.
Future land for new residential housing is increasingly constrained by challenges including:
• Land ownership fragmentation
• Infrastructure servicing and sequencing issues
• Environmental challenges such as biodiversity considerations, high ground water and/or lack of water for public open space
Infill Development
52% of infill development in Perth and Peel is only creating between 2 and 5 dwellings.
Apartments as a percentage of all dwelling approvals have declined consistently since 2016 and current sits at just 2% of all dwelling approvals.
Delivering infill development at scale is complex, meaning it takes much longer to get large scale built-form development to the market.
Meaning we are considerably behind the Perth and Peel at 3.5 million infill targets.
Key challenges include:
• Site acquisition
• Securing finance and sufficient presales
• Complex approvals processes
• Current materials and skills shortages
