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Event: Press Conference, National Regional Housing Summit
Date: 9 February 2024, 9.30am AEDT
Speakers: Denita Wawn, CEO Master Builders Australia; Liz Ritchie, CEO Regional Australia Institute; Councillor Linda Scott, President Australia Local Government Association; Anna Neelagama, CEO Real Estate Institute of Australia; Helen Haines MP, Federal Member for Indi; Justin Hancock, CEO Quilpie Shire Council
Topics: housing supply; labour shortages; migration; Housing Australia Future Fund; regional Australia
E&OE
Liz Ritchie, CEO Regional Australia Institute: Okay. Well, welcome. Today we are hosting the first regional housing summit to shine a light on the fact that rural and regional Australia continues to grow in this country. We are witnessing a societal shift that is seeing more people from our capital cities want to move and live and work in our regional communities. This has been supercharged since the global pandemic. Many punters believe that this is reversing and we’re here today to tell you strongly that it’s not. The Regional Australia Institute has been tracking population movements over the last decade, and we continue to see a 12 per cent net gain to regional communities since the global pandemic. Now what that’s doing is creating growing pains across rural and regional Australia. So we’ve partnered with the Australian Local Governments Association, Master Builders, the Regional Real Estate Institute of Australia. Today we’ve brought together 200 people from across Australia – decision makers, our MPs, we’ve got investors, superannuation funds here to come to start to support solutions that we know are already underway. We’ve captured a whole range of case studies from across the country. We know that regional people are doing what they do best. They’re coming up with their own solutions, but we have a supply shortage and we’ll speak to that in a moment. There’s a few things that we would really like to see from government. We want to see a long term national population and settlement plan that will help us ensure that we can rebalance the nation and have more equitable supply of housing. Greater mixed density of housing. We’re crying out for one and two bedroom apartments in regional Australia. But what I would also say is that regional Australia is far from a homogeneous place and that when you look at the different markets that we need different solutions for different markets. We need the bespoke policy settings that will address the particular needs in particular markets. For example, the regional home buyers, first home buyers scheme can drive up price in high growth and popular areas. What we need is those policy ideas targeted to areas that have lower growth. So we’re calling for place based, targeted solution. We’re also calling for our fair share of the investment. So we want to see 40 per cent of the investment cordoned off from the Housing Australia Future Fund to ensure that we will have our fair share of social and affordable houses across rural and regional Australia. We are really underdone when it comes to social and affordable housing because it was never a focus. It needs to become a focus. I might stop there and hand over.
Denita Wawn, CEO Master Builders Australia: Denita Wawn, CEO Master Builders Australia. We have all collectively come here together for one issue and that is we have a housing crisis in this country and it is not confined to our capital cities. It is also across the country. Local government, state governments, territory governments and the federal government have all committed through the national cabinet process to ensure that we can resolve these supply constraints to meet the Housing Accord target of a minimum of one million homes over five years up to 1.2 million. The clock starts ticking on the 1st of July 2024 to reach those targets. And if we look at building approvals currently we’re going to be well short of that number if we continue in the current state. So how do we solve it? As Liz said, we know what the solutions are that we need commitment from all levels of government as well as leadership from communities and from business, including ourselves, at a meeting here today, to ensure that we can turbocharge those solutions. Enough talk. Let’s get on with the job of building for all Australia. Thank you.
Councillor Linda Scott, President Australia Local Government Association: On behalf of Australia’s 537 local governments, we’re proud to stand with this strong coalition to urge more support for ensuring we address Australia’s housing crisis. Australia’s local governments are at the frontline of Australia’s housing crisis. But we collect only three per cent of the nation’s tax take and with more than half of our 537 local governments experiencing damage from natural disasters in the last year alone, we need more support from federal and state governments to ensure we can deliver the housing that’s needed for Australia’s future. As we approach the federal budget, local governments need federal funding for local infrastructure. The drainage, the parks, the footpaths, the bike paths, the libraries. These are the kinds of local infrastructure commitments that make places liveable. That enable us to deliver new housing supply. We need strong financial commitment from the federal government to fund and support the local government infrastructure load for Australia’s future.
Anna Neelagama, CEO Real Estate Institute of Australia: Anna Neelagama, CEO of the Real Estate Institute of Australia. When it comes to housing supply, we’re going to have the supply shortfall 165,000 homes by next financial year. But we actually know the solutions to that and the federal government should come to the table to help assist regional Australia achieve that. So there’s two things. We need to build more houses and we’ve got a better use for homes. And that’s things like fixing skills for the building and construction sector. Looking at lower cost materials and on the existing home side, looking at short stay accommodation, how we can attract the 109,000 homes in that pool back into the long term rental market. And seriously looking at the first time that things like nationwide stamp duty reform. And looking in the regions, how we might better attract investment into the regions with things like stamp duty reform. I’m really honoured to work together with this important coalition to help boost Australia’s regions and I hope we see the solution of that in Budget 2024. Thank you.
Helen Haines MP, Federal Member for Indi: Good morning, everyone. Helen Haines, Independent Federal member for Indi. I am thrilled to be here as part of a coalition of like-minded people from right across rural and regional Australia calling for the federal government, for state governments to do better when it comes to addressing the housing crisis in rural, regional and remote Australia. I feel like I’ve been a sole voice in the federal parliament calling for things like a rural and regional infrastructure housing fund. I’ve been calling for $2 billion. That’s the amount of money we needed at bare minimum to build the infrastructure that my colleagues are talking about to even get to first base when it comes to opening up the land to create the desperately needed supply that we have such a shortage of in rural and regional Australia. Absolutely. The poles, the pavement, the power, the water connection, the sewage in places like Wangaratta, where I live, we’ve run out of of water connections for example. For decades, successive governments have said build it and they will come. Well, they’ve come and we haven’t built it. So this is my call. I join with my colleagues too, in calling for a proportional spend of the Australian Housing Future Fund, the HAFF, to be targeted into rural, regional and remote Australia. Right now we have no sense whatsoever that there will be any portioned funds coming into the regions where we so desperately need it. We’re seeing in our rural and regional communities for the very first time, homelessness, rough sleeping, couch surfing. We have run out of places for people to live. We need also to be sure that we have the workforce to assist us in creating the supply that we so desperately need. So again. I’m calling for federal government action to target needs that we have in rural and regional Australia and get us in a position where we can truly be the powerhouse that we know that we should be across this nation. Thank you.
Justin Hancock, CEO Quilpie Shire Council: Justin Hancock, CEO, Quilpie Shire Council. I’m pleased to be here today to highlight our place-based solution in South West Queensland for the housing crisis and just to reiterate that support needed from all levels of government, state and federal to make sure that we have the infrastructure in place to cater for this housing crisis. For too long infrastructure has been failing. Infrastructure has been getting, falling behind it and we need funding now and long term funding solutions to make sure that we have the roads, the sewerage, the water infrastructure in place to make sure we can build our communities that comes from the communities for the future. Thanks.
Journalist: Is this the death of the quarter acre rural block that we’ve known? And are regional communities just going to move into these high-rise apartments in future?
Liz: I don’t think it’s the death of the quarter-acre block, but what you are seeing is that the regional communities are changing. Our regional economies are much more sophisticated then they were even a decade ago and we see that through the job profile. We know that 10 years ago the majority of job vacancies were in low to medium skill. Today, the majority of job vacancies for which we have record job vacancies right now are in the professional spheres. So the whole environment, our local economies are changing and as our population tracking tells us, more millennials are moving to the regions. Younger people are taking those opportunities. This is the whole profile. The demographic mix is changing. So younger people don’t want to have to look after a garden. They want one and two bedroom apartments, townhouses, low maintenance. We’re busier than ever before and we just are looking for that mix. So that is new and that’s exciting. We’ve got a lot of communities dealing with that. It’s a great example in the Discussion paper about Dubbo having done the high rise there. We know that places like Shepparton, they run a community connect programme. 600 people have relocated to Shepparton and 97 per cent of those people want one or two bedroom apartments. So it’s getting it to market sooner rather than later. Ensuring that we’ve got the skills and the builders to make that happen there. There are wonderful solutions that we’re talking about today. We don’t want this to seem all gloom and doom. As I said this morning, it was only five years ago that I stood here at this very same Old Parliament House and we were crying out for people to move to regional Australia. So how the world has shifted in five short years, which is why the Institute and the coalition here today, we’re all calling for longer term planning. We need to see this longer term population settlement plan that deals with not only the housing, but where are we going to see those investments in rural and regional Australia? We know that regional Australia is at the frontline of the energy transition. We will have no chance of getting that right and meeting our energy targets, meeting our energy demands if we can’t start planning long term about where the jobs of the future will be, and therefore the social and infrastructure that’s needed to meet that demand. But you know it is vital that we start to see much greater commitment for funding, investing and supporting our rural and regional communities to get the housing right.
Journalist: This might be a question for Master Builders, but how are we going to cope with I guess having the right number of construction workers to get this stuff done and as we heard, having materials that actually are cost effective to build with.
Denita: Thank you. From a materials point of view, we know materials are around 35 per cent higher than what they were pre-COVID. That is a significant issue as a consequence, not just of inflation, but general push on pricing of materials. In terms of people, the reason why housing at the moment is costing 40 per cent more than what it was pre-COVID is predominantly because of skill shortages. Master Builders Australia has estimated that we need another 450,000 workers in to the industry to meet the Housing Accord target. That is a significant number. The key to that and trying to resolve that problem is through ensuring that we have less exits than we currently do. We need greater targeted skill migration and that’s why we believe we need a greater focus on the trade skilled people. Getting access to them as quickly as possible into this country. Not only in terms of visas but also licensing recognition and also looking at the very high bar we currently have in terms of English language proficiency. We believe that if we support workers that don’t have the proficiency of English let’s teach them when they’re here as opposed to closing the door for those people to come and live and work in Australia. So we need more people. We need to encourage them to live in the regions. But of course, it’s a chicken and egg situation. We need the houses for them to live in if they come to regional Australia to build the homes that we need. So there is a delicate balance that we need to address and that is why we think it’s so important that the migration program is very heavily focused on skilled migration so we can resolve these issues as quickly as possible.
Journalist: And in terms of actual land in our regional communities, do we have the space to build this infrastructure or do we need to work on also land zoning and releases and things like that? Is anyone able to speak to that?
Linda: Local governments are, of course, constantly in the process of considering land, where we have the power to, and ensuring that it’s zoned correctly for the right public good. The consequence of land zoning decisions is that infrastructure is required. We of course know that without drainage, without footpaths, without roads, new housing developments simply can’t proceed. And of course, the cost to the public of retrofitting drainage under infrastructure built is so much more expensive. It’s why, in order to address Australia’s housing crisis, local governments need more support from the federal government for our local infrastructure needs. We know right around regional Australia, the lack of funding for drainage and other critical local infrastructure is a barrier holding up the supply of more and affordable homes for Australians.
Journalist: We’re seeing locals live in hotels and caravans and tourists in houses. How can we sort of tackle this problem of short stay rentals in the regions?
Linda: It certainly is the case that not that many years ago, homelessness and rough sleeping was not a problem in regional Australia. Yet now in 2024, mayors right across Australia are reporting concerns about communities who are experiencing homelessness and are rough sleeping. These are significant concerns for local governments. We know that the delivery of new housing is complex. Of course it is important to have appropriate supply. But we can’t risk our local economies at the same time. It is important to facilitate tourism and to have that appropriate balance of commercial floor space, homes and retail and, of course tourism to promote and support our local regional economies. Local governments are great at getting that local balance right. What we need from the federal government is funding support for the local infrastructure to deliver the right now.
Liz: Yeah. Can I just add to, I think the question, I think the question about, you know people sleeping in caravan parks, hotels, you know this is where we are because we weren’t planning for the population change. And I just can’t stress it enough. The size of shift is well underway. You know, you’d have to go back to the 1950s to see where we became a much urbanised nation to know that pendulum is swinging back towards regional Australia and that is why the long term planning is absolutely so vital. If anybody had looked at the approvals, pre-COVID, you would have seen that they weren’t keeping pace with population growth even before COVID. Now we’re on the other side of the pandemic and we are in a pinch point. And what you’re seeing is a consequence of that, that people are having to, you know, purchase run-down hotels just simply to house their workforce. We hear countless stories of businesses having to in some cases they’re purchasing additional homes just to house their their workers. So there’s all kinds of creative models being rolled out, but they’re all imperfect. We have an opportunity to get it right, but we have to think long term. We have to be visionary. We need our political leaders to think about the whole country and to invest in the whole country. Regional Australia is vast and it is far from homogeneous. It’s so diverse. You know, yes, we do have a major shortage but there are still places in regional Australia where there is housing. What we want see is a greater mix of housing in those communities. So we don’t want this to all be doom and gloom. We do understand, you know, there are challenges, there are complexities. But we have this really unique time in our history to get this right, to get in front of the problems that we know are fast coming towards us. To reimagine what Australia can look like into the future.
Journalist: Juliet Helmke from REB. We’ve heard from the RAI today about the call for setting targets for HAFF, 40 per cent of HAFF and a target for the National home building goal. Is that something that is supported by the full coalition today? Or is that still up for discussion? So I suppose my question is for Master Builders, local governments and the Real Estate Institute of Australia.
Denita: From the Master Builders’ perspective, the HAFF and particularly the first round funding it’s going to be investor-led and investor driven. And the big issue at the moment is that can you get the returns right. And we’ve heard this morning from one of the participants that the returns in, particularly in remote areas, is simply not right. So we’ve got to recognise that when you are having institutional investors purchasing into HAFF and the HAFF certainly is providing that social and affordable housing, of course, you’ve got to have proportionate investment but equally, we’ve got to make sure that the taxpayers numbers are stacking up and we’re encouraging investment. So the issue will be how do we resolve what everyone has spoken about today of getting those costs down, making sure that we have the right infrastructure because you need to get those fundamental settings right before you even contemplate building. And that’s where our focus is on. Get the infrastructure right. Get it build ready. Because if we don’t get a build ready then it is just a theoretical argument as to whether or not HAFF is going to be useful.
Media contact:
Dee Zegarac
National Director, Media & Public Affairs
0400 493 071
dee.zegarac@masterbuilders.com.au