Question on May 10
My question is for the LORD MAYOR. It appears that the current Administration’s present strategy regarding housing affordability is to continue increasing the supply of private market housing while directing very little funding towards community housing and social housing. Organisations like the Brisbane Housing Company (BHC), which used to be funded by Council, seem to be receiving very little financial support from Council at present.
Council is allowing the construction of sprawling new private developments on the suburban fringe as well as apartment tower projects in the inner ring, with densities of over 500 dwellings per hectare. Five hundred dwellings per hectare exceeds the standard densities of most large cities around the world, including Beijing, Singapore, Paris, Tokyo, Mumbai, Delhi, London and New York. I strongly support densification of the inner-city, but that level seems a bit excessive.
Leaving housing construction and supply largely up to the private market means that councils and governments have comparatively little control over house prices. I will emphasise that it means that housing for lower income workers won’t become significantly more affordable unless the property values of owner-occupiers fall substantially. What outcome does the LORD MAYOR hope to see? Leaving it up to the private market and neglecting to fund community housing means you can really only have one or the other, I guess. Which is it? Does the LORD MAYOR want property prices in Brisbane to fall, or does he want prices to rise?
Yes, thanks very much, Madam Chairman. I will take that the thrust of the question obviously was around affordable housing. Councillor SRI, you know, like most people, I want to see more affordable housing where it can be accommodated. The reality is, though, in not only this city, but if you look at most major cities around the world, affordability is a major issue. It is a major issue because, whether we like it or not, the market does at the end of the day dictate.
When you ask me the question, ‘do I want to see higher house prices or lower house prices’, that is a bit unfair, in the sense that, if you go out and you ask people of this city, there are a lot of people who do want to see house prices increase. There are a lot of people who undertake further investments as a result of those house price increases. They undertake investments in new housing. They undertake that investment, and they create jobs out of that.
The reality is that, if we had declining house prices, we would I believe, in this city, also have declining employment. We would have regressive growth, and, whilst with good intention, creating a more affordable climate, we would have an economy which created many, many more negative impacts on people and their lifestyles in this city.
We talk about the Brisbane Housing Company. That housing company was set up with the opportunity to provide some accommodation which was below market rent. We made significant investments in that company. The State Government made some investments as well, and it is now at a stage where it has a significant amount of investments and is able to sustain itself in terms of those investments and use the moneys obtained to create further housing opportunities.
I think if we used our whole Council budget, we would still struggle to create cheaper housing prices as being proposed by Councillor SRI. I admire his ideological position on this, but again, I think it is out of step with reality. If he’d go around to many parts of this world—you have mentioned Beijing. I would take you to a sister city of Brisbane called Chongqing in China, in the province of Sichuan. Although it is a special zone within China, some 35 million people live in that one city. You talk about density here; that is density, Madam Chairman, with one and a half Australia’s in one city.
Is there an easy or perfect answer to this? No, there is not. This Council will continue to look at ways. Certainly our housing market here is a lot easier to get into than that of Sydney or Melbourne. There was a time when we were comparable with Melbourne. We are now not. Melbourne’s prices are now much higher than they are here.
Supply does have a bit to do with it. It is not the total answer; I accept that, but it does have a bit to do with it. Take away that supply and see what happens to housing prices then. Then you will have a demand which will push up housing prices due to lack of supply. If you look at the history of this city that has always been the case.
That ends Question Time.