Alyssa Luc and her partner Xuan Tri Mai are among many Australians who wish they hadn’t rushed into building a home.
It was the end of 2020 when the couple purchased a block of land in Catherine Field, a growth area suburb south-west of Sydney.
Their block cost about $500,000, and they spent another $700,000 to enter a contract with what they thought was a reputable volume builder.
The couple moved into their new home in July 2023 and, just days in, Ms Luc says they started finding alleged defects, starting with a blockage in their toilet.
“If anyone would like to go build a new house, please think carefully,” Ms Luc warns.
“Think about the economy … think about the builders at the moment.
“I mean, they [people] can see that so many builders [have] collapsed in the past few years. They should know now that the industry is vulnerable.”
It was supposed to be the end of what building industry pundits have labelled as a “property cyclone”.
But even if the eye of that cyclone has passed, savage storms continue to wreak havoc on Australia’s $270 billion construction sector.
Each month across Australia, on average more than 200 building and construction companies go under.
The building industry is still reeling from one of its most tumultuous periods in history — a loss-making boom that eventuated soon after the pandemic.
Consumers — lured with tens of thousands of dollars of grants under the controversial HomeBuilder scheme — were sold on fixed-price contracts that builders then struggled to honour as the cost of building materials and labour soared.
The effects of that are still playing out.
Call to better protect subcontractors and consumers
Statistics from corporate watchdog ASIC show that for the current financial year so far, to March 17, there have been 1,987 insolvencies in the building industry. This is up from 1,495 a year earlier and just 782 in 2022.
More horror stories are emerging of subcontractors and suppliers waiting to get paid but at risk of never seeing a cent, and consumers left with half-built homes or major defects.
“With the [Home Builder grant] stimulation, we went from a very low point to boom time, and we weren’t ready for that big upswing,” says industry veteran and the founder and director of Satterley Property Group, Nigel Satterley.
The Perth developer has worked in the industry for more than 50 years, including advising governments on housing policies, and sees better times ahead.
“We have moved out of the cyclone — I really believe the worst is over.”
But while consumers are back making enquiries about building a home, Australia’s volume builders warn many remain nervous about signing on the dotted line.
They say consumers are holding back both because of high-interest rates and cost-of-living increases, as well as fears they might end up with a dodgy product or a builder that’s at imminent risk of collapse.
Mr Satterley is calling for a fundamental rethink of laws regulating the industry so that subcontractors and consumers are better protected.
“We need a lot more corporate regulation around directors that trade — the building companies — that know they can’t pay the bills, or they’re insolvent,” Mr Satterley says.
“For example, you could start ‘John Smith Homes’ with working capital of $200,000, and be building 500 homes a year, because these are what we call capital-light businesses that run on cashflow. And when the cash flow stops, they go bust.”
Some builders are asking customers up-front for deposits of 5 per cent or more.
Mr Satterley suggests these be placed into a regulated trust account, which already happens in the case of developers, but usually not with builders.
“If you [the builder] takes money from the trust account, you go to jail,” he says.
“I think these types of regulations need to be [implemented] across the home building industry.”
Another issue politicians constantly raise with him is how to better protect subcontractors in the industry.
“I think there should be serious regulation [if a contractor] is not paid,” Mr Satterley suggests.
“Our industry pays on the 15th and the 30th, generally of the month, so give a couple of days, if they’re not paid, they should be able to lodge an immediate complaint for protection.”
He also believes governments should do more to help build the pipeline of skilled workers needed to meet greater housing demand over the next few years.
‘It’s been very stressful’
Ms Luc agrees there are not enough consumer protections and, to try to get a resolution, they’ve had to use the legal system.
Her main concern, especially while she’s been pregnant, has been finding traces of silica dust throughout her home.
Silica dust can be toxic. It’s commonly used to make products across the home, especially for stone benchtops in kitchens and bathrooms.
Safe Work Australia says that when workers cut, drill or grind products that contain silica, dust particles are generated that are small enough to lodge deep in the lungs and cause serious illness or disease.
It’s been such a big issue impacting workers in the industry that, at the end of last year, Australia became the first country in the world to ban the use of engineered stone following a surge in workers developing lung disease silicosis.
Ms Luc says they had an expert do a report for them that suggests that traces of the dust they have been finding throughout their home may be dangerous to their health.
“We did ask them [the building company] to come out immediately because of health concerns — and so far, we’ve only had people come out to do cleaning,” she says.
Ms Luc says there are also other alleged defects around the home, and she’s lodged a complaint against the building company that will be heard by a tribunal.
“[It’s been] very stressful — it took a lot out of me. It takes a lot out of both of us. Mentally I try to be strong for myself, for the family and my baby.”
Fears of a ‘catastrophic failure’
Even for those who don’t build, but buy off the plan or opt for homes that have been recently built, significant problems have emerged.
Toplace was once one of Australia’s largest privately owned development and construction companies, which claimed to have built 30,000 properties across Sydney.
But the developer went into administration in July 2023, owing hundreds of millions to creditors, and its founder Jean Nassif went overseas despite being wanted on fraud-related charges.
The owner and founding director of the Toplace Group building licence was suspended for 10 years in 2023 by NSW Fair Trading and Toplace’s licence was permanently revoked.
IT worker Patrick Quintal says his life has been destroyed by buying into one of Toplace’s troubled developments – Vicinity Apartments in Canterbury, in Sydney’s inner south-west.
When asked if people should buy off-the-plan or newly-built apartments, he says: “Don’t. Just don’t do it, you are playing Russian roulette with your life basically.
“In fact, I think you might actually have better odds playing Russian roulette than this.
“It is crazy how poorly the government is ensuring people can actually safely buy property. You’re expected to be a lawyer, the building engineer, all of that on top of your nine-to-five job. It’s draining.”
Mr Quintal purchased a unit with his wife in May 2021 for $685,000 but now may be up for hundreds of thousands of dollars more to fix serious defects.
Within months of moving in Mr Quintal had an engineer do an expert report, which he says described the entire building as a “death trap”.
A report from the NSW Building Commissioner identified major issues with the slab and beams in the basement of Vicinity Apartments.
Mr Quintal says the entire building is now being held up by temporary steel structures and worries with increased building activity around the area — including a metro station – the whole structure could one day collapse.
“It’s not really safe,” Mr Quintal says.
“The building as it stands, could not support any kind of movement that was similar to a seismic activity. [It could mean] catastrophic failure … resulting in the building basically collapsing.”
Mr Quintal is still fighting for the council or government to pay the cost of fixing the defects, but in the meantime says he’s financially and emotionally devastated.
The Department of Fair Trading has estimated the total cost of the repairs to be about $50 million.
With 276 units, that means owners like Mr Quintal are looking at a cost of at least $180,000 each, but possibly more as construction costs remain elevated and time drags on.
At the same time, he says quarterly strata levies have jumped from $900 a month to about $4,000.
“For me, the financials are quite, quite dire,” Mr Quintal says.
“We were planning on having a family shortly after we got the place. And I feel like I’ve just been in such a mental rut that I don’t think I could afford to have kids, or whether I’m even mentally ready to have kids simply because I have to deal with the stress of this building, day-in day-out.”
Mr Quintal says the onus shouldn’t be on the owners to fix defects that weren’t of their doing. He also wants the law changed to better protect consumers.
“My hope is that the government will come in and take responsibility for basically the issues that they’ve created,” he says.
“It’s not just this building. It’s many apartments that we’ve seen over the last couple of years … They’ve all got similar problems.”
New home builds in decline as the cost of building rises
The quality of building is one issue that’s kept consumers wary of taking the leap into building.
The soaring cost of building is another. Metricon chief executive Brad Duggan says the builder is still working through a pipeline of post-pandemic boom loss-making jobs, but when it comes to getting people to commit to new home builds, now things are much tougher.
In 2022, Metricon was in financial crisis talks but was thrown a lifeline from its financier the Commonwealth Bank, which kept it from facing the same fate as many other builders.
Mr Duggan says there’s been a 40 per cent increase in enquiries from would-be buyers this year but that a “lack of confidence” is holding people back from signing a contract.
“There’s such pent-up demand [but] people don’t want to take that step [of signing the contract],” Mr Duggan says.
“It [the fear to sign a contract] comes from two places, one lack of confidence about the affordability, and also a lack of confidence in building.”
Mr Duggan hopes the RBA will soon signal when they will be cutting interest rates so that more would-be buyers will take the leap into building.
However, he also warns that building costs could go even higher now that changes to the National Construction Code, designed to make more homes energy-efficient and accessible, have taken force.
New requirements under the code include increasing minimum energy-efficiency standards for new houses and apartments from six to seven-star ratings, and more stringent accessibility standards, including step-free entry to dwellings, a toilet on the entry level, accessible doorways, and reinforced bathroom walls.
The Housing Industry Association says these changes could increase the cost of building by about $20,000 to $25,000, depending on the type of build.
While Metricon generally supports the new NCC requirements, Mr Duggan questions “whether it’s the right time to be looking at it now”, while there’s a housing affordability crisis.
“It won’t be an insignificant [price] increase.
“I think there’ll be a number of builders that may not be able to go to market because they don’t have NCC compliant homes, which may mean that there is a lack of supply for the market, which could have some impact (on supply).”
Not enough workers to build 1.2 million homes
Australian Bureau of Statistics (ABS) data shows Australia’s record level of immigration is easily outpacing new construction.
The ABS latest building approvals data released on Thursday, found that total dwellings approved in February fell by 1.9 per cent, to 12,520.
Attached dwellings drove the decline, down 24.9 per cent to 3,771. This was the weakest monthly result since 2012.
Total dwelling approvals are running at 163,099 annualised, a level well below Australia’s underlying dwelling requirement.
As demand for housing increases, the industry warns there are just not enough workers to build the 1.2 million homes (about 240,000 dwellings a year) the Albanese government wants to see built over the next five years.
There are industry estimates this target requires an increase in the building trades workforce of 90,000 people, but Mr Satterley believes it might be even more.
“Australia can only complete, annually, around 130,000 dwellings per annum, maybe just a few more,” says Mr Satterley.
“What the prime minister is saying he wants is 200,000 completions a year, that is impossible to do.
“We would need somewhere in the order of 400,000 qualified tradesmen this calendar year, and next year.”
But as baby boomers leave the industry, there are fewer young people coming in to learn trades.
Data from Master Builders suggests that over the year to September 2023, a total of 42,333 new apprentices started in the building and construction industry — this represents a 25 per cent reduction on the previous 12-month period.
“This country is being held back through not enough people to do the work,” Mr Satterley argues.
“And what we’re seeing is the tradespeople are making more money and working less. So production is slower because the tradies are working less hours for more money.”
Will more builders go under and job losses rise?
Insolvencies in the building and construction industry are predicted to continue to spike over the coming months and overtake pre-COVID highs and possibly even top post-global financial crisis highs.
That will mean more job losses.
HIA’s managing director Jocelyn Martin says she feels for those consumers who are left with those half-built projects when builders collapse, but it’s been hard for builders to manage cash flow.
“There are no winners out of the insolvency situation,” Ms Martin says.
“One of the biggest challenges we have in the industry is working with fixed price contracts — where the builders have had to lock in price for their customers, well in advance of supply of supplies, and then supply prices have increased.”
She hopes there will be fewer horror stories going forward, noting that there are already “changes happening” in the way the building industry is regulated.
“I think there is an improved regulatory system,” she says.
“There are certainly more detailed inspections around properties. There is much education for builders, in terms of repercussions for builders that have gone broke or into administration.”
The building and construction industry remains one of Australia’s largest employers, employing roughly 1.3 million Australians.
And, despite the calls for more workers in the sector, there have already been job losses off the back of failed building companies.
Others have had to take pre-emptive action and announce redundancies.
It was almost one year ago when Simonds Homes boss Rhett Simonds had to make the tough decision to cut 10 per cent of the company’s workforce.
“You’re going through and you’re adjusting to economic environments, those hard calls have to be made,” Mr Simonds tells ABC News.
The family-run builder’s decision to cut costs has paid off.
Simonds Homes, which is now listed on the ASX, earlier this year delivered a $100,000 quarterly profit, its first step into the black in two years.
“Let’s not deny it has it’s been a tough period for the industry for the last probably two to three years,” Mr Simonds says.
“We are coming through the other side of what has been … a shaky couple of years in the industry.
“As we start to see the stabilisation of interest rates and ultimately, hopefully, down the track, some small decreases in interest rates, that’s definitely going to play a major factor in consumer confidence.”
Mr Simonds hopes the industry will be given support, including enough skilled tradesmen, to build the homes needed.
“We do have a housing shortage and that is something that will continue to be a challenge for our economy and our country,” Mr Simonds says.
Gemma Lanigan, head of DNG New Homes
The increase in new-homes stock, fuelled by the high number of building-site commencements (nearly 33,000 in 2023), is to be welcomed. Despite this good news, supply will yet again not come close to meeting demand, especially in the entry-level price bracket dominated by the first-time buyer.
The Help to Buy scheme and the First Home shared-equity scheme continue to play significant roles for first-time buyers. With more attractive mortgage interest rates available to buyers purchasing properties with a higher Ber rating, buyers are now more aware than ever of the merits of an A-rated new property.
Thankfully, mortgage interest rates appear to have stabilised. While it is unlikely that interest rates will decrease significantly in the medium term, their stabilisation is very welcome.
We are also delighted to see many new affordable homes schemes due to come to the market in 2024. These homes, which are made available through the Local Authority Affordable Purchase scheme, will be in greater demand as awareness of this excellent scheme grows among purchasers. To date, any release of affordable homes by a local authority has been significantly oversubscribed and therefore more affordable homes schemes will be required to meet the level of demand.
Ivan Gaine, managing director of Sherry FitzGerald New Homes and chairman of Property Industry Ireland
In 2023, the new-homes market experienced significant developments, with housing output and delivery influenced not only by market forces but also by the housing system, incorporating policy and politics. Reforms are under way, showing positive impacts and a recent uptick in commencements.
Most successful countries and cities have their challenges around planning and delivery of housing – it is not a uniquely Irish issue with similar deltas in supply and demand and debates ongoing around the world.
Last month, completion data revealed about 32,595 homes finished in 2023, with affordable homes (AHB) and the State sector playing a growing role. Only about one-third of completions enter the market for sale, while the rest comprise social homes, rental homes (decreasing proportion) and self-builds. Despite a year-on-year increase in gross completions, especially in apartments, the targets are still too low.
The ongoing review of the National Planning Framework (NPF) and Housing Needs Demand Assessment (HNDA) is the priority for the industry. Planning for the future involves setting supply targets closer to 60,000 per year, ensuring sufficient infrastructure, utilities, schools, amenities, parks, transport, and land management are in place before building up construction-sector skills and capacity.
One of the simpler initiatives introduced last year which was instantly effective was the temporary waiver of development contributions and a rebate of the Irish Water levy which is currently due to expire in respect of new commencements after April. This is effective and aids viability, particularly in the regional cities and supports delivery for all tenures.
The First Home shared-equity scheme and Croí Conaithe (owner-occupier apartment subsidy) are gaining momentum, and new guidelines on compact settlements were welcomed in January. The Planning and Development Bill is progressing through various stages, with an intention to enact it before summer.
While progress is being made in implementing new policy measures, it is imperative to fine-tune the new policy framework and strategically plan for our future communities.
Sarah Murray, director of new homes at Savills
Given the level of sales activity and pickup in demand already experienced, 2024 looks set to be another strong year for the new-homes market. However, while an increase in overall housing supply is anticipated, supply is unlikely to improve in the coming months.
This ongoing deficit in supply will continue to impact the market driving quicker sale time frames and, in certain locations, increased pricing. This has led to today’s buyer being prepared and ready to purchase more quickly as they are educated on mortgage finance and, where applicable, the Government-supported buying incentives that have seen a significant uptake in recent months.
Another feature of the market that looks set to continue is the increasing demand for apartments, duplex and town houses. These properties appeal to all types of buyers as it tends to be more cost-effective to purchase than rent, in particular for buyers availing of buying incentives and lower green mortgage rates. Similarly, another feature of the market, evidenced in 2023, is buyers considering purchasing a new home further afield. Where once buyers may have limited their property search to areas that are well known to them, today’s buyer is happy to consider a well-serviced new town or location in their pursuit of new, energy-efficient housing.
Ray Palmer-Smith, director of new homes at Knight Frank
The year has started strongly and we have agreed more than €100 million in new-homes sales already. The extension of the Help to Buy scheme, as well as the First Home scheme, will continue to support the demand for new homes, while the prospect of interest rate cuts this year will also provide buyers with more certainty and comfort regarding mortgage costs. Factors underpinning demand in the prime new-homes market, particularly with downsizers buying apartments, include the running-cost savings and the lack of refurbishment works associated with new homes.
Forecasts suggest that 35,000 units will be delivered to the market in 2024. While this would represent another welcome increase, further growth is required to meet demand which is estimated to be in the region of 50,000 units. The ongoing shortfall with strong demand is likely to set the scene for another year of price growth across the new-homes market.
Efforts to streamline the planning process through the new Planning and Development Bill will be closely watched. Increasing the supply of zoned and serviced land should, however, also be the focus of renewed efforts.
Judy Sorohan, director of new homes at Hooke & MacDonald
As we look to what 2024 may hold in store for the new-homes market, it is anticipated that we will see some similar trends to 2023. Construction activity is expected to remain at a level where 34,000 or 35,000 properties are delivered to the market; 2023 saw 33,000 completions.
While this is still a marked improvement on where we were a few years ago, we still have a way to go to achieve the 55,000 or 60,000 that are needed to deliver an adequate number of homes and meet the needs of the growing and ageing population.
There is strong focus on the first-time buyer, which is the area of the market that is most active. However, it is important to also deliver the right types of property to other purchasers such as those looking to downsize from larger properties. The delivery of such would also help to increase the numbers of second-hand properties being brought to market.
This tight level of supply is expected to underpin stable prices both in the Greater Dublin Area and nationally with potential for moderate growth.
It remains to be seen if interest rates begin to come down in the spring. This will have an impact on affordability and how the market performs for the year.
Demand for new homes remains robust given the wide gap between levels of energy efficiency in new-builds and existing properties. Consideration must be given to the associated costs in delivering new-build properties with A Ber ratings. This, coupled with the 10 per cent levy on concrete blocks, pouring concrete and other concrete products, adds to high costs for builders.
While there are signs of improvement with the new large-scale residential planning system, we have yet to see how it copes with a high number of applications. Reports also indicate that more than 20,000 housing units in strategic housing developments are yet to be decided with another 8,000 delayed by judicial review. The planning structure still needs attention. Land taxes such as the Residential Zoned Land Tax and the Land Value Sharing contribution will create more obstacles to delivering development land of sufficient scale for large schemes.
We are also seeing more new homes being delivered in the outer suburbs of Dublin and in surrounding counties which can offer more affordable options for some purchasers. Encouragingly, we expect to see a higher number of properties coming to the market via the Affordable Purchase Scheme.
Will Coonan, director of Coonan Property
There appears to be plenty of demand out there. We have just launched the second phase of a development in Blessington, Co Wicklow, called Sorrel Wood and we experienced very keen interest levels in both the three- and four-bedroom homes, with all units selling out.
Demand appears to have remained robust despite the drags of last year’s interest rate hikes and continued geopolitical uncertainty due to the war in Ukraine; there continues to be a shortage of supply for the first-time buyer in particular.
The Government’s support with regard to incentives for these buyers, such as the move to extend the Help to Buy scheme to the end of 2025 and the implementation of the First Home scheme in summer 2022 are welcomed, as well as the grant available for vacant, derelict homes and for those looking to retrofit.
Along with the incentives in place, new-home purchasers are keen to purchase energy-efficient, A-rated homes, which now have green mortgage options with more attractive interest rates than older homes.
Frank McSharry, director of new homes at Lisney Sotheby’s International Realty
The new-homes market will remain busy with strong buyer sentiment outstripping supply. Elevated interest rates and banks adopting more risk-averse policies will be a feature, at least for the first half of the year. This will impact movers and investors but for first-time buyers, the increases will be somewhat offset by the higher loan-to-income (LTI) ratios that were introduced in January 2023.
The green credentials of new dwellings have greatly added to their attractiveness in the last two years and will continue to do so. Green mortgage interest rates are typically 30 basis points lower than non-green rates.
The median price of a new home in Dublin grew by almost €40,000 last year while second-hand homes grew by substantially less. While a large part of this discrepancy can be attributed to their green credentials, the various Government support measures for first-time buyers are also factors.
New-home starts and completions were strong last year despite the higher cost of building materials, labour and finance. Commencements nationwide were about 33,000 with close to 20,000 of these in the Greater Dublin Area; the highest level in 16 years. Completions are estimated to be at a similar level to 2022 of about 30,000 units. Interestingly, apartments nationwide will make up about one-third of the total – just five years ago this figure was as low as 12 per cent and in single digit percentages before that.
There are two things the prime minister needs to get into his head about tax. One is that saying he won’t make any further changes no longer works. The other is that negative gearing doesn’t do much to get people into homes.
Anthony Albanese seemed to have taken the first point on board when he spoke to Insiders on Sunday.
Rather than promising flat out not to change the rules around negative gearing, he merely said he was “supportive of the current rules, we have not considered changes to them”.
But he was less careful when it came to the virtues of negative gearing. He said there was “a whole lot of analysis that says they encourage investment in housing, the key when it comes to housing is housing supply”.
His official advisers in the treasury don’t think negative gearing does much to increase the supply of supply of housing – or, if they do, they omitted it from the six-page briefing note headed “negative gearing“, prepared to help the treasurer answer questions about it in parliament.
Our rules reward bad management
Negative gearing is a particularly Australian tax benefit, which – unlike in other countries – benefits dud landlords: those who can’t make money by renting out properties.
If they lose money (by paying out more in interest, maintenance and other expenses than they are receiving in rent) we let them offset that loss, not only against income from other investments, but also against income from their wage or salary.
It means they can cut their wage for tax purposes, cutting the tax they pay on it. And at the same time, they can hang on to a property they can later sell for a profit, which will be taxed at only half the normal rate, thanks to Australia’s 50 per cent discount on capital gains.
It isn’t allowed in the United Kingdom or the United States. There, if you are a landlord who can’t make money, you can offset your losses against profits from other investments – but not against your wage.
In Canada you can offset rental losses against wages, but there must have been an “an intention to make a profit”. That would probably rule out most Australian negative gearers.
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Most gearers don’t build homes
In Australia, an astounding astounding one million of us negatively gear – more than one in nine taxpayers. In 2020-21 they claimed losses amounting to $8.7 billion – 3.5 per cent of the income tax collected – meaning that if they didn’t do it (if they didn’t claim for what seem to be deliberate losses) the rest of us could pay less tax.
What Albanese said on the weekend was half right. Negative gearing encourages investment. Most months, more than one in three new home loans is for an investment property.
But most of those loans don’t increase supply – the thing Albanese says matters.
That’s because the overwhelming bulk of investor home loans go to “investors” planning to buy existing homes – to bid against and likely beat would-be owner-occupiers.
In December 2023, only 23 per cent of the loans to investors was used to build a home or buy a newly-build home. In November only 19 per cent.
As a means of getting more homes built, negative gearing leaks like a sieve. As a means of ensuring Australians continue to rent, rather than buy, it’s effective.
In the 20 or so years since the headline rate of capital gains tax was halved, supercharging negative gearing, the proportion of Australian households renting has climbed from 26 per cent to 30 per cent. If those extra renters become owners, an extra 400,000 Australians would be in homes they could call their own.
How to get better value from gearing
The really bizarre thing is that Albanese has it in his power to ensure negative gearing does exactly what he said it did – supercharge the building of houses.
All he would need to do is what Labor promised to do in 2016 and again in 2019. In those elections, Bill Shorten went to voters promising to limit the use of negative gearing to newly-built homes.
As Shorten put it, taxpayers would :continue to be able to deduct net rental losses against their wage income, providing the losses come from newly constructed housing”.
The sieve would no longer leak. Every dollar of tax lost to a negative gearer would help build a home.
What would have happened if Shorten had got his way: if Australia both focused the use of negative gearing and cut the capital gains discount as he had proposed?
Modelling just published in Australian Economic Papers finds the share of households who own their home rather than renting it would have climbed 4.7 per cent.
That’s security worth having, especially if it is accompanied by more homes.
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An idea whose time is coming?
Australia’s Treasury has begun publishing estimates of the cost of the present unfocused system of negative gearing. Its latest, released last week, puts the cost at $2.7 billion per year, to which should probably be added a chunk of the $19 billion per year lost as a result of the capital gains concession.
The estimates are new. Until Jim Chalmers became treasurer, his department didn’t publish estimates of the cost of rental deductions.
Chalmers is far from the first treasurer to be curious about what the concession does. Scott Morrison expressed concern about the “excesses” of negative gearing.
And Morrison’s predecessor, Joe Hockey, said on leaving parliament that negative gearing should be skewed towards new housing, so “there is an incentive to add to the housing stock rather than an incentive to speculate on existing property”.
Albanese is normally cautious. But as he is showing us right with his rejigged Stage 3 tax cuts, there are times when he is not.
If he really wants to throw everything he has got at building more homes, he knows what to do.
Peter Martin is visiting fellow at the Crawford School of Public Policy, Australian National University. This article originally appeared on The Conversation.
Cave Creek continues to grow with new housing developments in the area opening up to welcome new residents. Two of the latest communities include Continental Mountain Estates and Saguaro Trails.
Continental Mountain Estates
The team at BedBrock Developers is excited to announce a new luxury community on 70 acres in Cave Creek.
The developer is celebrated for its custom homes and luxury subdivisions such as Crown Canyon, Cameldale Estates and Kachina Estates, all of which stand as affluent and record breaking communities in Paradise Valley. Now, the company is planning to construct nine luxury homes on expansive 5-acre lots within the Continental Mountain Estates development.
According to BedBrock Developers, the visionary behind this project is company president Rich Brock. Introduced to the subdivision in spring 2023 by Nancy Wolfe of Coldwell Banker Realty and Silje Garner who runs BedBrock’s in-house real estate company, Brock has collaborated closely with landowner Lou Spelts to bring forth this exceptional development.
Initially acquiring over 300 acres of land for his personal retreat, Spelts, who is a member of the Tovrea Ranch family, has since sold off the majority, retaining the premier 70 acres that form the foundation of Continental Mountain Estates.
“The breathtaking panoramas of Carefree and Cave Creek are truly captivating, particularly during the enchanting sunset hours,” Spelts said. “Several lots also offer distant vistas of Phoenix city lights and Camelback Mountain, which I found quite exciting.”
“I have always loved the area of Cave Creek; the breathtaking landscape and the authentic Western ambiance of the town resonate with many of our clients,” Brock said.
“Driving through the hills, we were greeted by a saguaro forest that resembles a desert haven,” he continued. “The seclusion of the land and the panoramic views felt like discovering a hidden treasure. We jumped at the opportunity of partnering with Lou to develop this community and are excited to bring our clientele a different product.”
BedBrock Developers has planned the construction of five spec homes and designated four homesites for buyers with a vision for designing and building their own dream residences.
BedBrock has engaged its long-time partner, Stratton Andrews, to spearhead the design process for the homes. Andrews brings a wealth of experience and an innate understanding of luxury aesthetics to the table, with a specific focus on blending rustic charm with the principles of organic modern design, according to the company.
The initial phase of sales presents two spec homes meticulously designed to set the tone for the development. Listed by Garner and Nicole Hazelton with BedBrock Real Estate Company, the two have already seen interest from BedBrock’s network and past clients looking for a retreat in the Cave Creek area.
KLMR Homes introduces Saguaro Trails
KLMR Homes, a Scottsdale-based homebuilder, recently announced the opening of its second project – Saguaro Trails in Cave Creek. The model home is now available for tours.
Saguaro Trails features 22 exclusive homesites on the border of North Scottsdale and Cave Creek. This enclave of serene living features four floor plans ranging from 2,642 to 3,558 square feet and three car garages. The 9,400 square foot lots provide ample outdoor living to enjoy the Arizona weather.
“The homes in this community give a rustic feel with the benefits of modern living,” said Alan Hall, co-founder and principal of KLMR Homes. “Saguaro Trails is the perfect place for long term guests or multigenerational living because of the casita options and multi-generational suites.”
The homes are designed with an open concept floor plan, optional vaulted ceilings and optional fireplaces.
KLMR Homes will continue to expand its footprint in 2024 with another development in Cave Creek – Forest Pleasant Estates. The community will open in the spring and feature 16 cul-de-sac only homesites. Every home will accommodate RV parking and benefit from a relaxed HOA.
For more information, visit klmrhomes.com.
On Friday, the 41-year-old homebuilder group, Saratoga Homes, invited officials to a grand opening celebration for homes it is selling in Levy Crossing, a new subdivision in south Killeen.
The event began at 1 p.m. on a cool afternoon with city officials, family and friends, excited to experience the ribbon-cutting ceremony, partake in the new home tours, eat a variety of barbecue meals and more.
Lunenburg’s town council will gather more details on what a major new development could mean for local taxes before starting the process to sell public land for the new neighbourhood.
People packed the gallery of the Town of Lunenburg’s council meeting Tuesday evening where Blockhouse Hill was on the agenda.
Consultants MacKay-Lyons Sweetapple Architects presented three options of what a new neighbourhood could look like on the back slope of Blockhouse hill, and a fourth option to leave it as a park.
Resident Heather Langille was among the six residents who raised concerns about the plan and called for councillors to consider more information before moving ahead.
“It should stay in public hands and it should not be sold for private interests,” Langille said after the meeting.
The development options have a mix of semi-detached duplexes, townhomes and secondary suites in a stepped design down the slope to the Back Harbour. New roads and pedestrian-only green streets are also included, and all options would not touch the existing RV campground and Sylvia Park.
The number of possible housing units range from none, if the land remains as is, to the highest-density option of 368 units.
Municipal staff said during the meeting that selling the land, and adding new taxpayers to the town, will help with Lunenburg’s aging infrastructure and housing crunch. A recent town report said it will cost about $46 million to fix 10 buildings in need of maintenance.
A housing assessment for Lunenburg states the town of 2,300 people needs 120 new housing units by 2027, and 170 by 2032 to accommodate its growing population.
But Langille said there are other areas of town “much more suitable” for housing. A petition from more than 700 local residents has asked to pause the project.
Council, based on a suggestion from Mayor Jamie Myra, voted to delay voting on declaring the land surplus — which would allow it to eventually sell the land for development — until March to hear back from staff on the taxes implications.
“We need to have some idea of those costs going forward to make educated decisions … that are better for the residents of our community and I think that’s really important,” Myra said after the meeting.
There will be another public hearing before any final decision is made.
Councillors also directed the consultants to draft development rules for the highest-density option — 368 units with about 36 per cent of the site as park space — which would set out detailed requirements attached to land even after it changes hands.
Consultants have estimated that option would cost about $182 million in construction, labour and water and wastewater upgrades for whoever develops the land.
Coun. Peter Mosher said he’d like to have rules for the “full plan” that could always be scaled down, or built in phases over the coming decades.
Staff had suggested drafting rules for the second-densest option (256 units) which was also the top choice for most people surveyed during the consultant’s workshops.
The Friends of Blockhouse Hill advocacy group raised concerns during the meeting, and in a letter to council, about development’s impact on the town’s UNESCO World Heritage designation. They have also taken issue with how only 10 per cent of the homes would be designated as affordable.
Julian Smith is an expert heritage planner on the consultant’s team who co-authored UNESCO’s recommendation on the historic urban landscape. He told the meeting all the development options in the buffer zone around Old Town Lunenburg are not highrise or industrial, so they would not hurt its designation.
In fact, Smith said a past chair of UNESCO’s World Heritage Committee told him buffer development that helps the Old Town survive as a “healthy community” where locals can afford to live would benefit both Lunenburg and be an inspiration to sites around the world.
Concerns about tourism pressure
Smith said Venice’s UNESCO designation, for instance, was put in danger this summer because tourism pressures have pushed affordable housing, and the ability for people to live normal lives, out of the historic city.
“Lunenburg is already feeling the effects of global tourism but those will only increase with time, and that’s a very serious threat to the integrity of world heritage sites,” Smith said.
But resident and Friends of Blockhouse Hill member, Alison Strachan, said Lunenburg’s tourism is seasonal and housing shortages could be reduced by cracking down short-term rentals.
She said town council could possibly look at Halifax’s rules requiring that rentals are owner-occupied in most residential zones.
Strachan also said consultation with the Mi’kmaw community is needed, as well as more research into the Indigenous history around the hill which has been largely unexplored.
“We should be the leaders in reconciliation. We are a colonized town — at their detriment,” Strachan said.
Myra said he would like the issue to go to a plebiscite in the upcoming October municipal elections.