Disclaimer: “Brisbane Now” is run by the Labor Party Brisbane City Council team. It is pretty explicitly biased in their favour.
Disclaimer: “Brisbane Now” is run by the Labor Party Brisbane City Council team. It is pretty explicitly biased in their favour.
I think more than likely it’s a bit of both. The land-banking criticism has been around since before COVID, so COVID cannot be used entirely to explain it. What we often see as evidence for the benefits of broad changes to the zoning system is how frequently developers will try to build something above the height limit in high-density areas, with Council regularly approving it—because they essentially have to approve it in order to keep up with demand.
But prices have definitely gone up, and that’s a problem. It’s not exactly clear that reducing infrastructure charges is a good response though, because that’s just going to make it harder for the Council to build the infrastructure necessary to make higher density housing provide a good quality of life. They’re also not a particularly large percentage of the overall cost, so the impact of reducing them on the actual affordability isn’t enormous. The problem needs to be addressed above the Council level.
I think your first paragraph nails it. Developers are holding off development not to introduce artificial scarcity, but to maximise development. So they keep the land empty until either they can convince the council to approve a higher density, or a change in state government gives them an avenue to bulldoze through the council roadblocks.
At least in NSW a single graph is needed to show this relationship: https://www.planning.nsw.gov.au/policy-and-legislation/housing/housing-supply-insights/quarterly-insights-monitor-q1/trends-in-housing-supply the correlation between number of approvals and number of constructions is basically exact. Which means, the roadblock to construction is council approval, not corporate greed or developers gaming the system to generate artificial scarcity or any other conspiracy you can think of.
I do agree that removing infrastructure charges is not a solution. From my perspective, this won’t do anything since developers aren’t blocked because of costs, but either materials supply or council blockades. Removing infrastructure charges solves neither of these issues.
It depends the infrastructure costs required for the new development is more than what they recover. If it’s less and reducing them encourages more development then it gives them more revenue overall.