Labor cops flak from both flanks over suburban high-rises

Labor’s move to reshape Melbourne by fast-tracking higher-density developments in the suburbs sparked a fierce backlash from political rivals on both sides on Monday.

The Greens are demanding that social and affordable homes be baked into the plan, while the Coalition accused the Allan government of depriving buyers of the choice to buy a standalone house.

The state government has a target of building 80,000 new homes every year.Credit: Darrian Traynor

Opposition Leader John Pesutto took his shadow cabinet to Melbourne’s outer fringe on Monday, seeking to use Premier Jacinta Allan’s housing overhaul to strengthen his pitch to voters in the city’s expanding greenfields suburbs.

“In [Allan’s] vision of Victoria, you don’t get a voice and you don’t get a choice. It’s apartments for everybody,” he said in Narre Warren, in the city’s south-east.

Allan’s first two pledges in a promised week of announcements to outline the government’s reform agenda – being sold as “more homes, more opportunities” – would lead to the creation of an extra 50 so-called activity centres, where higher-density housing would be encouraged near railway and tram lines.

A new 12-month stamp duty stimulus measure has slashed the tax for off-the-plan units, townhouses and apartments to boost demand and provide financial security for those developing the projects.

Pesutto said both policies were a “desperate” attempt to distract from the fact the Allan government was struggling to reach its goal of building 80,000 homes a year.

He said the government should be funding infrastructure such as childcare, roads and public transport in the city’s growth corridors.

But Allan dismissed what she called a “NIMBY-style approach” that had kept young people out of the housing market.

“We need to fight back against this approach for the simple reason, for the single reason, is it’s just not fair,” she said.

“I want to fight for them and be a builder.”

But the Victorian Greens said the plans would make the housing crisis worse unless they forced developers to build public and “genuinely affordable” homes as part of the policy change.

The party has been calling for inclusionary zoning, in which a benchmark is set that 50 per cent of new housing in special development areas should be public and affordable.

Greens housing spokesperson Samantha Ratnam, who is running for the federal seat of Wills at the next election, said Victoria’s policies must ensure they did not deliver only expensive homes.

“If Labor wants to fundamentally reshape our city, they need to do it in a way that creates housing that teachers, nurses and young people can actually afford, but right now, Labor is just giving incentives to wealthy property developers to build expensive houses that won’t solve the housing crisis,” Ratnam said.

“If Labor actually cared about building homes that young people can afford, they would require developers to build genuinely affordable and public homes in these zones, rather than just allowing developers to build expensive luxury apartments.”

Ratnam said the government needed to encourage development near jobs, services and transport to allow young people to live near where they grew up.

Treasurer Tim Pallas said the stamp duty concession, which began immediately on Monday, would cost the state about $55 million for the one-year program.

He said high interest rates had softened demand, while worker and building material shortages had pushed up the cost of building.

Pallas said the temporary plan would see the sector through, as commodity prices softened and with interest rate cuts expected by early next year.

“Get them while they’re hot,” he said. “We expect that over the next 12 months, the material circumstances will improve.”

Pallas said it would help developers prove they had sufficient capacity to deliver projects and get financing.

“Will we see examples of projects being mooted but not ultimately realised? Yes, of course we will,” he said. “It’s the nature of the industry, but this once again facilitates projects being able to be put away, and we should see less of that.”

Federal independent MP Monique Ryan said nine of the first 25 new activity centres were in her electorate of Kooyong.

“The premier has said these zones are ripe for development because they have benefited from level crossing removals. That is not the case,” she said.

“Removal of the Glenferrie Road, Kooyong, and Tooronga Road, Malvern, level crossings must be a part of these major housing developments in Kooyong.

“All three levels of government must work together on the housing crisis. I’ll push for massive federal investment in transport infrastructure, including removal of these level crossings, plenty of off-street parking, electric vehicle infrastructure, and consideration of green spaces and heritage concerns.”

State Libertarian MP David Limbrick, who kicked off a state inquiry into stamp duty, welcomed the announcement.

“The government reducing taxes is less common than hen’s teeth,” he said.

“I hope that downsizers will take this opportunity to move into more suitable accommodation and let younger people move into their houses – which is how a healthy market should work.

“I suggest people thinking of downsizing take advantage of this offer and go ahead and do it.”

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