Legislative Council Fifty-Fifth Parliament, First Session (55-1) 55 1 Parliament of South Australia Legislative Council published Matters of Interest Matters of Interest Housing Affordability Housing Affordability The Hon. T.T. NGO Legislative Council The Hon. T.T. NGO (15:25): I rise to speak in support of the recent state government pre-sale guarantee fund for apartments/developments in the Adelaide CBD. As the lack of housing is contributing to the housing crisis, I believe this policy announcement is crucial to accelerate the delivery of more homes quickly. Recently, I had a student from the South Australian Parliamentary Internship prepare me a report on housing affordability and innovative solutions. Her findings suggest that housing affordability has had tremendous effects on South Australians, marked by a mismatch in housing demand and supply. As housing affordability worsens and housing stress becomes more common, South Australians are more than ever open to the diversification of living arrangements and types of housing. Medium to high density housing, like apartments, can facilitate a strong housing supply to meet the increasing and changing housing demand. The outward expansion of cities was once a solution to boost housing supply, which was enabled in the past by relatively affordable land, energy and finance. Adelaide has already stretched too far north and south as its expansion to the west and east is limited by geographic boundaries. The rate of urban sprawl in Adelaide faces challenges from limitations in infrastructure and the public transport system. This highlights the need for more medium to high density housing projects, not only to provide more affordable housing to South Australians but also to encourage more mobility and investment in the Adelaide CBD. Despite this, higher density housing construction has been restrained, as conventional detached homes remain the most common kind of new dwellings. Economically, medium to high density housing is generally more cost effective for governments and home owners, but not as profitable as conventional detached houses for developers, due to the lengthy approval process and increasing material costs. The requirement of the 50 per cent to 80 per cent pre-sale rate for projects to secure financing also leaves many projects being discontinued. In response to these challenges, the South Australian Labor government recently announced a $500 million fund that will guarantee up to 50 per cent of dwellings—or up to $30 million per project—in eligible off-the-plan developments. This means that if the dwellings remain unsold the developers can call upon the guarantee and the government will purchase them at a discount of 10 per cent of the market value. This will help developers to start construction with ease and avoid leaving spaces underdeveloped. This fund opens pathways to high-rise buildings by supporting housing developers and the construction sector with the goal of delivering more housing in the short term. The guarantee fund, and the recent changes in building height regulations, will enable South Australia to make progress with the Housing Roadmap and the National Housing Accord. It will encourage developers to deliver well-designed and well-located options. Apartment developments will make the city area an integrated and vibrant residential, cultural and commercial hub. This government is committed to supporting developers and delivering affordable housing to help young people in entering the housing market. I believe that the Malinauskas Labor government's $500 million Pre-Sale Guarantee Fund will help to achieve this by improving housing supply and affordability. The ACTING PRESIDENT Legislative Council The ACTING PRESIDENT (The Hon. T.A. Franks): Welcome back, the Hon. Laura Henderson.