‘Let’s have a proper crack’ at 1.2m homes: Property Council CEO

Zorbas’ address was the first time a Property Council of Australia executive had spoken to the National Press Club in more than 20 years, and so the chief executive used his time well, warning that there will be an additional 4 million people calling Australia home by 2034.

If current (and future) housing woes are to be solved, Zorbas acknowledged the need for partnership between government and industry.

He also stressed the necessary focus on supply across all housing typologies hailing from this partnership as “the rock, the paper and the scissors of solving the housing crisis”.

Arguing that housing sits “at the heart of our social contract with each other”, Zorbas said it’s “ultimately essential to our long-term social cohesion”.

It led the CEO to then highlight the Property Council’s nine-point plan for better housing across Australia’s cities, conceding that the plan is “a combination of actions that we have never properly tried as a nation”.

So what is the PCA putting forward?

Urging the completion of the 1.2 million home target, Zorbas said he is “sick and tired of hearing the whinging about whether or not we will hit the target”.

Instead, he urged everyone to “have a proper crack”.

He also called for improvements to the “broken” state planning systems and for the stoppering of “increasing taxes on investment in new projects each quarter”, especially across Victoria and NSW.

Zorbas also requested a backing in of the government’s industry training improvements, which can be complemented by additional skilled construction trades coming from overseas, as well as more modular and prefab construction, and better use of the airspace over existing buildings “as a first resort for new development”, among other priority areas.

Despite the multitude of factors that have converged to create a housing crisis, Zorbas is of the belief that “we are blessed with a trifecta of housing supply advantages as good as any on this earth”.

Noting it as a kind of “cruel” juxtaposition, he pointed to the fact Australia is “not very big” – only the 55th largest national population across the world.

Despite our size, we are the 12th to 15th largest national economy, and “the sixth largest nation by landmass”.

“Given this trifecta … a million homes by 2029 – our national cabinet agreed target should, and can be, a modest target in this revenue and land-rich nation,” he reflected.

“And yet, by all published measures – anywhere – Australia is one of the global housing supply wooden spooners.”

Citing the NSW Productivity Commissioner’s recent warning that Sydney could become a city without grandchildren, Zorbas then asked the question:

“How did we get here?”

From his perspective, “our housing supply deficit is largely born of the failure of past state cabinets, past governments and past parliaments to hold themselves or local governments to account for productive housing delivery over the past two decades”.

Flagging that property taxes “are the lion’s share of the large state budgets”, Zorbas condemned the choices made “not to spend enough of that money on delivering social, affordable and at-market housing from those consolidated revenues”.

Zorbas then went on to concede the fact that very few parliamentarians or councillors “know anything about how to fund or deliver the creation and renewal of cities on assuming office”.

He explained: “Historically, on housing supply deficits, some of these same modestly qualified representatives have tended to shift the blame to any other available level of government (which may be true), to negative gearing (which actually supports new supply and enables upkeep of existing supply), to the excesses of a customer-driven market, (rent freezing is a supply killer that directly reduces new housing funding and production, as no less than the Brookings Institute tells us), to ‘land banking’ (a quick look under the hood shows this is an evidence free statement as these cash flow-oriented businesses owe the bank and investors always with interest).”

Acknowledging that many leaders are all for housing supply … “provided, of course, that it’s ‘one suburb over’,” the CEO once again quipped the importance of hitting the 1.2 million homes target.

From his perspective, only if Australia hits these targets “can we achieve smarter and more sustainable planning, stable, investment-welcoming tax settings and intelligently manage our overall migration intake while increasing the absolute number of people with construction skills in, and coming to, Australia”.

But to do so, we must “realise that hitting those targets involves an unprecedented parliamentary and business partnership”.

A ‘grand’ idea

In closing, Zorbas again stressed the “paramount” importance of a grand housing partnership.

He urged state parliaments, above all other things, to publicly commit their treasuries and their planning systems to deliver better supply and choice of housing to a changing and ageing population at a scale and an affordability level that has been incorrectly managed in the past.

“This unprecedented era of partnership is needed across parliaments – not just national cabinet – not just premiers, treasurers and planning ministers – but all parliamentarians, with industry and the profit for purpose sector to fix our capital and regional cities and solve the structural causes of the housing crisis,” he continued.

And in calling for better approval systems and the championing of housing and building, the CEO concluded: “The final call to action is simple – let’s give this challenging issue a crack together.”