SUSTAINABLE City Future Committee president Cr Peter Young expects Gold Coast City Council’s (GCCC) $8000 grant for people who buy or build a new home in the city to stimulate demand.
Young’s plans to further incentivise the buyer market have been passed through Council and he is confident the boost will complement the State Government’s property initiatives detailed at last month’s Budget announcement.
He had originally hoped for a $10,000 boost to the State’s existing grants for first-home buyers, which has been dropped to $8000, while $5000 is also available for other eligible purchasers
“This is where we’re looking at the State Government’s building boost. There’s (already) potentially $17,000 for a young couple that want to walk into a new home. If we can add to that as a council than we are providing a pretty attractive package,” says Young.
“This is easily marketed, for example in Sydney or Melbourne; ‘come up to the gold coast you’ll have $27,000 dollars in your pocket’. That’s money in the pocket for a new home buyer to move to the Coast, put their kids into school here and distribute money into our economy.
“For every dollar that’s spent like this there’s $2.70 coming back into the market so we’re confident these demand side subsidies will help us.”
While largely supporting GCCC’s Gold Coast Building Boost package, the city’s peak development body says the initiatives will only benefit purchasers currently in the process of purchasing or sounding out the market.
Gold Coast Logan Urban Development Institute of Australia (UDIA) branch president Stephen Harrison, believes the complete $2.5 million stimulus would benefit less than 400 purchasers.
“This initiative is purchaser-focused, which the industry supports. To genuinely stimulate the economy and create construction jobs, there needs to be incentives at the purchase and delivery ends of the process,” says Harrison.
“But in reality, this initiative is going to be limited to prospective buyers out looking at the moment. It will result in a short-term injection of jobs, but it won’t benefit buyers who have intentions of purchasing land and building new homes 6 months from now.
“Setting aside only $2.5 million places more importance on the grant being part of a combination of initiatives; alone, it will not cure the coast's current predicament.”
Cr Young admits previous GCCC initiatives have failed, but says the new package will provide greater movement in the property sector.
“We’ve introduced some subsidies in the past with the best intentions that have been a flop; they’ve just not worked as there’s no movement in the market,” he says.
“It’s fine for us to be advocating and supporting subsidies at the construction end with (lower) infrastructure charges, but there’s no point building thousands of apartments that people aren’t going to buy.
We need to stimulate that other end of the market and that’s the motivation behind this push at the moment; to provide a stimulus at both ends of the spectrum.”
The UDIA strongly supports other Council proposals, including:
• Scrapping application fees and infrastructure charges for businesses which want to fit out, for instance, an existing vacant space for a coffee shop or a hairdressing salon;
• An area based reduction on infrastructure charges aimed at locations such as Pimpama / Coomera that are most in need of stimulus;
• Supporting the fly-in, fly-out initiatives already proposed.
“Council has already introduced some encouraging initiatives such as the 50 per cent reduction on application charges on a case by cases basis; offering retrospective infrastructure charges to eligible applications which have development approvals prior to July 1; and committing to proactively resolving legal disputes before arriving in court,” says Harrison.
“The Gold Coast Building Boost proposed by Council shouldn’t be seen as the single panacea for the Gold Coast construction industry’s ills; it needs to be part of an integrated big picture approach.”
UDIA Gold Coast-Logan is hosting its Queensland Development Conference 2011 at the Sheraton Mirage on August 25-26. More info at: udiaqld.com.au
Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support