Will the Rise of the Housing Market Help Reduce its Price?
Last Wednesday, opposition leader Matthew Guy pledged to provide nearly 300,000 lots to boost Victoria’s housing market in an attempt to lower home and mortgages loans in Australia. However, the experts claim this movement will not necessarily help lower its prices.
The Promise of New Land
Mr. Guy claimed that the State Government has the power to lower down the rising house prices if it would release more lands in the outer suburbs in Melbourne. Furthermore, Guy accused the Premier Daniel Andrews of Victoria for his inaction to help his fellow Victorians to enter the affordable housing market.
According to him, their inaction has resulted in a surge of inequities where acquiring a house and lot package 50 kilometers away from the CBD would cost you around $400,000- $550,000. Meanwhile, the Planning Minister Richard Wynne claimed the Labor plans to release around 100,000 lots at the end of 2018 and the remaining 190,000 lots for the next coming years.
They will also establish a coalition plan where the council areas of Casey and Cardinia, Hume, Melton, Mitchell, Whittlesea, and Wyndham will be given new lands to battle the housing and infrastructure shortages of these fast-growing outer suburbs.
The Coalition will also fasten their planning approvals to fulfill their promise by mid-2020 and provide housing supply to these suburbs for the next 12 years. And those local councils and authorities who delay the new land supply may have to face financial sanctions and penalties. Mr. Guy also said this plan of his will help decentralize Victoria from Melbourne and he believes that the rise of 290,000 lots and housing in outer suburbs will not increase Melbourne’s footprints. Furthermore, this new movement will force the developers to lower their prices to compete. Thus, providing better opportunities for potential home buyers.
While Guy’s plan looks promising, some house experts beg to disagree. The Director of the Center for Urban Research Jago Dodson, for example, claimed that flooding the state with lots and land options would not result in price reductions.
The Planning Professor at the University of Tasmania, Jason Byrne, seconded Dodson’s claim. He said that the introduction of low-cost housing in the outer suburb will likely result in a price increase in other fringe areas, especially within the Victoria CBD. He also claimed that people cannot really lower down their cost through these affordable housing if they still need to spend more money in commuting just to go to the city and work.
If they don’t have an access to jobs or livelihood near the outer suburbs, they’ll still be forced to go to the city. Thus, he believes they won’t be able to save more money, but rather, they’re only transferring their costs.
The Urban planning professor Peter Phibbs of the University of Sydney also said that commuting to the outskirts of a city and traveling back to their low-cost yet long-distanced home not only drains the people financially but it also impacts their well-being. He stated that many research shows how long commutes exhaust a person and it’s detrimental to their physical and mental health.
This new movement of Guy received criticisms from the public, especially the Housing Minister Martin Foley who claimed he couldn’t trust the Coalition for this affordable housing plan. He questioned who would believe his word when it comes to planning when he didn’t do anything for four years of staying in the government.
He also reminded the people that he’s the man who brought the Ventnor, Fishermans Bend, who engaged in secret meetings and shonky deals with developers for political donations.
More in Loans & Mortgages
Biggest Mistakes To Avoid Before Retiring From Your Day Job
If you wish to have a comfortable retired life, experts say that it’s absolutely vital to get your finances in order...October 23, 2018
Four Reasons Why A Federal Student Loan Is A Good Idea
In the USA, an average college tuition per year ranges from $11,000 (for public universities and two-year colleges) to $60,000 (for...October 21, 2018
Four Simple Ideas to Boost Your Income
More often than not, most of us usually find ourselves with little to no cash to spare by the end of...October 18, 2018
Local, National, Or Online: What Kind Of Bank Account Should You Choose?
Banks are no more confined within the brick-and-mortar buildings that were commonplace in every community and every town only a few...October 17, 2018
Four Celebrity Heiresses And Their Incredible Bank Accounts
Despite being stressed out with all the curve balls that life throws at us, it doesn’t deter us from indulging into...October 14, 2018
How You Can Utilize Your Home Equity For Retirement Planning
Oftentimes, you might have wondered whether or not to consider your home equity as an asset in your plans after you...October 11, 2018
Five Reasons Why Taking A Vacation Is A Good Investment For Your Career
In a fast-moving world where time is the greatest luxury, many of us think that keeping aside time for vacations is...October 9, 2018
Types Of Mortgages You Can Avail For Buying Your House
Owning a house is a huge responsibility, and it is surely one of the biggest assets you will ever have. However,...October 8, 2018
Want To Be A Successful Businessman? Avoid These Six Things!
Though we tend to feel as if they’re far superior than us, successful businessmen are people just like you and me....October 7, 2018