Thank you for the opportunity to submit for budget and governance support to assist Grounded’s mission – to provide more community led development (CLD) and therefore perpetually affordable housing.
We congratulate the Allan government for the expansion of the Vacant Residential Land Tax, the introduction of the Windfall Gains Tax and reducing land tax thresholds to zero. We expect these factors will curb the growth in Victorian land prices, something that appears to be underway.
However, we feel the Victorian community needs another pathway to affordable housing that is part market, part public interest. People are coming together concerned that for-profit developers are churning out expensive, poorly designed homes that have little connection to neighbours.
Community Land Trusts (CLTs) offer that potential. The growing UK affordable housing movement is building off the impetus of community groups coming together to provide locally accountable housing.
CLTs are a shared equity vehicle where the Trust owns the land and manages this very carefully to ensure access costs do not outstrip wage growth. The Resident only has to borrow for the housing, avoiding the damaging interest costs attributed to the land component. This provides a significant advantage in reducing the deposit required to just 40% of a typical mortgage.
Whilst community housing providers are doing a valiant job, there needs to be a for-purpose start up ecosystem to incentivise more communities to come together to make a difference.
The policy reforms covered in this submission include:
- Housing Grants and Subsidies – repurpose towards perpetually affordable projects
- Vic Homebuyer improvements
- AirBnB Locals First Cap n Trade policy
- Property option registry
- Community led development ecosystem
- The potential of Community Land Trusts
- Statutory definition of CLTs
- Prescribed lease
- Community led exception sites
- Rural exception policy
- Mandatory inclusion’s affordable supply to ensure affordability lock
- Planning Section 173 to include planning prioritisation through all stages of government.
- Planning flexibility – 40 hectare rule advantages large landholders, whereas medium sized farms could host affordable farm pods.
- Future concerns
- Property Data barriers to analysis
- Feudal fractionalisation
- Water rents
Whilst the various state land reforms announced have a dampening effect on prices, we are concerned that the commodification of property will still continue ahead due to national, local and financial incentives. There is still more work to do at the state level.