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Victoria - land sales slump but prices reach new heights

Land sales slump but prices hit new heights

News that the median price has hit $190,000 a block comes as the development industry celebrates three Baillieu government policies aimed at increasing land supply on the urban fringe, reducing the burden of infrastructure levies and making it cheaper to hold land. As a result, sales of Melbourne house blocks have slumped by three-quarters in a year. (The Age report 18th January).

Planning Minister Matthew Guy told The Age the Coalition would also change the controversial infrastructure levy of $95,000 a hectare in Parliament, so that landowners have to pay only when they are ready to develop a new estate - not at the point of purchasing land for development.

Due to greed, favouritism towards developers and population growth, it sounds like land prices may have actually peaked.

The “chronic shortages of land” is being blamed, not boosted demand due to population growth.

Limits of growth

There are limits to growth, including prices. Once prices peak, they will find sales go downwards. It just becomes unaffordable for the average family to buy.

Speaking at a rally held in Melbourne last year to oppose the adoption of Planning Scheme Amendment VC67, Green Wedge Coalition joint co-ordinator Rosemary West said the changes would see 43,600 hectares taken out of the green wedges for urban sprawl.

The urban growth boundary expansion will clear for urban development 5000 hectares of environmentally significant Western Basalt Plains grasslands, the grassy woodlands of the Maribyrnong and Merri Creek catchments with their giant red gums and 4000 hectares of the south east food-bowl where highly productive market gardens using recycled water double as southern brown bandicoot habitat, she said.

Food bowls bulldozed for housing

Melbourne’s South East contains some of Australia’s most fertile agriculture land and produces fresh food for Melbourne’s rapidly growing population. As urban growth takes over existing farmland, new food production areas will need to be developed. 
The project planned would see the development an intensive irrigated food production zone on Melbourne’s south-eastern fringe, to be known as the ‘Bunyip Food Belt’. 

Media Release - July 2010

However, with the State Government able to achieve its population estimates for Casey within a more contained boundary, City of Casey Mayor Cr Lorraine Wreford couldn't understand why Planning Minister Justin Madden abandoned a critical part of the Bunyip Food Belt in favour of urban expansion.

The State Government’s decision to allow the Urban Growth Boundary (UGB) to encroach on the highly fertile, valuable and sustainable farming lands in Casey is a huge blow to the entire state. 
The agricultural lands of the Bunyip Food Belt have the potential to not only supply abundant and fresh produce to the people of Casey, but to the whole State, so this decision will impact all Victorians.
Once this land is built on, it is gone forever. The State Government’s decision to allow the further expansion of the UGB into an area Council has fought hard to conserve for agriculture, is a bitter disappointment , said Cr Wreford.

Obviously, profits for developers and State coffers are more important than food security.

Land is not a limitless resource

Land is not a limitless resource. We can't have urban sprawl destroying more of the most devastated State in Australia.

We already know the impacts of floods in Brazil due to massive deforestation.

According to the 2008 State of the Environment damning report, Victoria's historic use of land has left a legacy of highly cleared and fragmented native vegetation over much of the State.  Current patterns of resource use in Victoria are unsustainable. 

High levels of vegetation clearing may constitute the crossing of an ecological threshold, beyond which rapid change occurs and ecosystems may not recover.  Development in peri-urban regions is driving loss of natural habitat and biodiversity, as well as agricultural land.

Victoria is already the most heavily cleared state. In Victoria, relatively stringent controls were introduced in 1987, but in the 15 years before that time, land in private hands was cleared at a rate of about 1% per year (CSIRO). Native grasslands are a highly endangered ecological community in Victoria, and have been reduced to less than 1% of their original extent.

We can't keep clearing land and bulldozing ecosystems for housing or we continue to reap the disasters of bushfires, climate change and species losses.

Photo: An Australian housing estate before construction in 2001. This estate is in Narre Warren, Victoria.

Victoria too reliant on property development

In his first interview since assuming the role of Victoria's Treasurer, Mr Wells said Victoria needed to broaden its economic base by rebuilding the neglected areas of agriculture and manufacturing.
It is reliant on population and migration and if one of those two factors flattens then part of the economic base will suffer.

So, our we are embedded in an economy that depends on population growth? Mr Wells also slammed what he branded the unsustainable level of government debt under Labor.

Population growth

The elephant in the room, as usual, is politically-driven population growth. With Victoria's economy based on land and property development, and service industries, there is little else to support our booming growth. We don't need a big population as we do not rely on resource mining, and agriculture doesn't require much either. Our politicians are basing their policies on short-term benefits at the cost of long-term sustainability. That's the bottom-line - political lives are short and political donations drive their policies.

The Baillieus are some of the most prominent land developers around Melbourne.  As such, strategies are unlikely to change.  With this affordability impasse, they'll look to hand people more hand-outs, "open" more land for developers, and wealth will ultimately find its way back into their pockets. It is a legalised wealth transfer of public money.

Although we like to think of ourselves as civilised, we're subconsciously still driven by an evolutionary impulse for survival, domination and expansion. This is an impulse which now finds expression in the idea that inexorable economic growth is the answer to everything, and, given time, we will naturally redress all the world's existing inequalities.

However, this logic fails to recognise that the physical resources to fuel this growth are finite. We're still driven by growing and expanding, so we will use up all the oil, we will use up all the coal, “vacant” land and we will keep going till we fill the allegorical Petri dish and pollute ourselves out of existence.

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Sydney Morning Herald, 19 January 2010:

Mr Kelvin Thomson said on Wednesday that he had written to Ms Gillard worried about a report in Indian business newspaper The Economic Times that Australia intended to target Chandigarh, Punjab and other cities in northern India with a promotional campaign in 2012 looking to attract skilled migrants.

"I told the Prime Minister I do not want the number of skilled migrants to increase, and do not support Australia running promotional campaigns to try to attract migrants," he wrote on his website blog.

Australians are required by law to complete regular Census forms on the understanding that collected data enables an informed government to predict and plan future infrastructure along with an adequate supply of skilled/unskilled worker requirements up to 20 years hence.

So what use is the Bureau of Statistics and its Census data if the information we supply isn't translating into a pre-planned and appropriately trained longer-term workforce? Despite Census data, we have insufficient numbers of workers including a severe shortage of doctors and nurses, and certainly a housing shortage.

We have good people. We have universities and technical colleges. We have talent. We have tenacity. The eastern State floods are giving all of us a wide open window on Australian culture, and it sure looks damned better to me than anything else on offer. But are governments focusing on our own population? Are we Australians numero uno in our own country, or not?

There's not going to be much room left at the Inn for thousands of diabolically displaced Australians. Due to government policy that encourages new arrivals and their lengthy claims on housing, health services and living allowances, our Inn is already overflowing.

And more than likely, new arrival largesse has been partially funded by our very own Australian taxpaying flood victims.

Ah, the cruel, cruel irony.

The government is considering a new "desal tax" for Victorians to pay for the blow-out costs of the desalination plant. Our water storages are rising and sufficient for at least 6 years even if we have a drought. However, due to the Brumby government's mismanagement and greed, we still have to pay for it!
The Thompson dam was opened in 1983 to ensure Melbourne was drought proof. However, due to boosting our population beyond ecological limits and the drought, we had to pay for this monstrosity. We hear all the time about "sustainable" from our government, but it is always ignored. The people of Melbourne have learnt to use less water, but our State government can't?

It is all about population growth to buy into our property market. Costs rise when we outstrip our ecological limits.(Emphasis added - Editor)

Australia's capital cities will more than double in size within 50 years under current immigration rates, dramatically affecting quality of life and cutting food production. Even with zero migration, the capitals will grow in size by roughly 50 per cent, costing residents an extra $1000 a year due to added congestion within the next two decades.

We are being plied with another population myth, that our growth is inevitable. With zero immigration levels, our population would either become steady, or decline.

Australia is declining, and the Lucky Country is being eroded by Immigration Nation. There are limits to any growth, and biology can support this. Growth beyond what is optimum, or useful and good, is malignant.

If we question our immigration policies, we are then "racist". Political correctness is a great manipulator, and a clever political tool.

Major builders and developers on Melbourne's urban fringe are selling up to half of some new housing estates to overseas investors and those hoping to migrate to Australia.
Developers court overseas buyers amid fears of greater urban sprawl

Simonds Homes general manager of sales and marketing said foreign buyers were helping to create jobs in Victoria and boost new housing supply at a time when building activity had plummeted.

The solution? Sell to foreigners and lure more immigrants here! For the sake of keeping developers' donations flowing to their election funds, politicians are selling our country to foreign landlords.

So, you can now "buy" a visa; that's just how it is. Owning a property gives more points to PR. What about the problems we'll face in the future?

The Australian govt appears to not give a damn about the citizens.

A report recently showed that Australia has one of the most unaffordable housing markets in the world. Why is this? It's because we have high levels of immigration. House prices are out of control in this country and it's only a matter of time before they come crashing down or Australia becomes another province of China!

Australia is not a sovereign country. It is merely an economy that must be fed no matter what the consequences.

We are being sold out to the highest bidder. We are facing increasing homelessness and impossible demands for public housing.

We've got so many citizens and residents who've already committed to this country and want to buy homes, they don't need any more competition from those who want may or may not at some stage in the future think about the possibility of moving to Australia.

Immigration is good for politicians. Immigrants come from countries that have never had it as good as we did, so they don't realise how bad our politicians are.

If you are not an Australian citizen you should not be able to buy any property or business. Just like what happens in other countries. Australia is a paradise but that is fast turning in a cesspit.
How does selling houses for foreigners help us? Production and ideas are the power-house of a healthy economy, not urban sprawl!

Once peak oil, food and water scarcity and climate change all hit us, Victorian will suffer.

We are suffering from reverse-racism! The scheme to allow foreign investors to buy into the property development and build within two years is not in the interests of Australians, the voters who elect our governments. It's proof that they don't care one bit for the people of Australia. We are living in a faux democracy.

Like the supposed "skills shortages" and the "ageing population", it is another insidious scam to drive up immigration and us hurtle towards a "big Australia". It ignores peak oil, environmental degradation and land clearing, climate change and more extreme weather, peak oil, pending food shortages, bulldozing of our food bowls, the blowout costs for potable water, and fails Australians trying to afford a roof over our heads.

The outer suburbs were the last place families could almost afford to buy into the property market, and now well-heeled Chinese and other foreigners - denied home ownership in their own countries - will be able to lock young Australia into the same predicament. We are often accused of being racists in Australia, but we are actually being discriminated ourselves, due to being politically manipulated and silenced.

Globalising our housing will mean more Aussie battlers, and more hardship, poverty and land-less-ness. We are not a sovereign nation any more but a province of China! Wake up Australia and do something about it before we all compete with the global community and simply be the trash of Asia-Pacific region.