The Housing Industry Association (HIA) has thrown its support behind the Victorian government’s decision to introduce a 12-month reduction in stamp duty for off-the-plan units, townhouses, and apartments. HIA Executive Director for Victoria, Keith Ryan, expressed optimism about the move, calling it a positive step towards improving housing affordability in the state.
Mr Ryan highlighted the inefficiency of stamp duty as a tax, stating that it unnecessarily inflates the cost of housing. A reduction in this burden, according to him, will help ease the financial strain on homebuyers and encourage more housing development. “Stamp duty drives up the cost of housing, and reducing this tax is a much-needed shift that will stimulate the housing market,” he said.
The announcement aligns with broader efforts by the state to support medium-density housing projects. The government recently expanded its ‘activity centres,’ where planning approvals will now be easier to obtain. These centres are intended to streamline the planning process for developers, offering more options for precinct designs in areas already near existing homes, workplaces, and family networks.
“This expansion makes it simpler for developers to find ideal locations for new projects. With fewer hurdles in the approval process, developers can plan more efficiently, creating homes that better fit into the fabric of local communities,” Mr Ryan explained. However, he also stressed the importance of ensuring that these reforms don’t focus solely on high-rise developments, but cater to a range of housing options.
Last year, the Victorian government unveiled its ambitious Housing Statement, aiming to construct 800,000 new homes over the next decade. Meeting this target, as Mr Ryan pointed out, will require all types of housing, from medium-density projects to greenfield developments. “If we are serious about addressing the housing shortage, we need to embrace a variety of housing options, not just concentrate on towers,” he added.
Despite the progress, the housing industry still faces several hurdles in ramping up supply. The challenges are varied, from the time and costs involved in delivering critical ‘last mile’ infrastructure to a range of regulatory changes and outdated building contract laws. Insurance costs, which continue to rise while availability decreases, further complicate matters.
Although today’s announcement marks a forward step, Mr Ryan acknowledged that more needs to be done. “Reforms like this are a move in the right direction, but there’s still a way to go. Builders are dealing with multiple challenges, and we need targeted reforms to ensure they can continue to deliver the homes that Victorians need,” he concluded.
This latest development signals a shift in policy that could alleviate some pressure on homebuyers and developers alike, but the road to resolving Victoria’s housing supply issues remains long.
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