Home-buyers have laid enough golden eggs for government

This impost is just the latest in a series imposed by governments on the home building industry. In Sydney a range of taxes and charges for infrastructure development is adding more than $100,000 to the cost of new home in a city which is already one of the most expensive.

In recent weeks NSW home buyers have been facing yet another round of price increases following changes to long service leave levies and the introduction of a new assignor duty. The Iemma Government seems oblivious to the damage it is doing to one of the state’s most important industries and is making a mockery of its much touted slogan that NSW is “open for business”.

Housing is becoming a regulatory target for a range of outcomes seen as desirable by local authorities. Increasingly these local authorities are pursuing environmental or social housing agendas through planning regulations, encircling builders with ever-increasing layers of red tape. Even when these regulations do not actually involve payments, they often produce delays that result in additional costs to the developer which will eventually appear in the final price of the home.

During his recent visit to Australia, American public policy expert Wendell Cox identified the great Australian dream of home ownership as being at risk, with young households and low income earners increasingly relegated to a lifetime of renting.

Laying the blame squarely at the door of government regulation, he pointed out that equity in housing represents nearly one half of overall assets owned by the household sector. “Australia’s rising home ownership has been a principle factor in the tripling of real per capita incomes since World War II,” he said.

“Take home ownership away and there will be a weaker economy with fewer jobs and a future looking more grim than in the past. That would be a first for Australia, or for any high-income world nation - and for no reason.”

Governments at all levels - federal, state and local - must review their attitudes to the housing industry as a matter of urgency. The goose has already laid more than its fair share of golden eggs and is beginning to look very sick. Remedial action is urgently required.