Incentivising the reform of housing planning controls would go a long way to addressing current supply issues, according to a new report... Big bank expects more consumer loans to turn bad in second half
The Federal government could increase housing supply and ease affordability issues by providing states with financial incentives to overhaul their planning laws.
According to a report authored by Deloitte Access Economics and commissioned by the Property Council of Australia, incentivising the reform of planning controls would go a long way to addressing current supply issues.
“This is about moving away from ‘dinky’ initiatives that give the illusion of dealing with housing affordability, but that do not deal with the substance,” PCA chief executive Ken Morrison said.
“The critical ingredient to addressing housing affordability is freeing up planning systems to help close housing supply gap, which currently sits at more than 200,000 homes,” Morrison said.
The proposal put forward by Deloitte and the PCA would see state governments be provided with upfront payments for planning reform as well as ongoing payments for continued strong performance.
That would include setting housing targets agreed upon by both levels of government as well and ensuring data is being measured and collected against those outcomes.
States would also be required to provide extensive modelling of their plans and the benefits they bring, while local governments would also be rewarded for planning overhaul.
Morrison said state governments could be assessed and rewarded based on metrics such as number of dwellings under construction, the cost of the average housing unit, or the number of dwellings under construction deemed affordable, as well as stricter and shorter timeframes for development applications.
Big bank expects more consumer loans to turn bad in second half
Analysts were disappointed by Westpac's bad debt charge increasing to 21 basis points, up from only 13 points in the second half of 2015. Pointing to mortgage and personal loan delinquencies as the problem, Westpac also expects bad consumer loans to rise in the second half due to housing activity easing and tighter credit standards.
Westpac's assets are comprised of 61 per cent mortgages, 13.3 per cent business loans, 9.6 per cent institutional banking, and 3.7 per cent consumer loans. Its actual mortgage loss rate is two basis points or $35 million, up by $3 million compared to the last half.
Yet Westpac chief executive Brian Hartzer assured investors that the problems are largely contained in areas reliant on the resources industry.
"While there have been a small number of large firms experiencing difficulties during the first half, these have been predominantly due to company-specific issues that have been, in some cases, exacerbated by the mining cycle," he said. "Company balance sheets are generally in good shape—having used lower interest rates to pay down debt – and levels of stress remain low."
Around the country, 90+ days delinquencies including impaired mortgages rose from 45 basis points in the September half to 55 basis points this half. Still, Hartzer believes that other aspects of the Australian economy are encouraging.
"The recent firming of commodity prices, solid employment growth—particularly in the services sectors – and ongoing low interest rates all support that outlook," he said. "We also see signs of moderating housing investment, although housing fundamentals remain in good shape."
According to a report authored by Deloitte Access Economics and commissioned by the Property Council of Australia, incentivising the reform of planning controls would go a long way to addressing current supply issues.
“This is about moving away from ‘dinky’ initiatives that give the illusion of dealing with housing affordability, but that do not deal with the substance,” PCA chief executive Ken Morrison said.
“The critical ingredient to addressing housing affordability is freeing up planning systems to help close housing supply gap, which currently sits at more than 200,000 homes,” Morrison said.
The proposal put forward by Deloitte and the PCA would see state governments be provided with upfront payments for planning reform as well as ongoing payments for continued strong performance.
That would include setting housing targets agreed upon by both levels of government as well and ensuring data is being measured and collected against those outcomes.
States would also be required to provide extensive modelling of their plans and the benefits they bring, while local governments would also be rewarded for planning overhaul.
Morrison said state governments could be assessed and rewarded based on metrics such as number of dwellings under construction, the cost of the average housing unit, or the number of dwellings under construction deemed affordable, as well as stricter and shorter timeframes for development applications.
Big bank expects more consumer loans to turn bad in second half
Analysts were disappointed by Westpac's bad debt charge increasing to 21 basis points, up from only 13 points in the second half of 2015. Pointing to mortgage and personal loan delinquencies as the problem, Westpac also expects bad consumer loans to rise in the second half due to housing activity easing and tighter credit standards.
Westpac's assets are comprised of 61 per cent mortgages, 13.3 per cent business loans, 9.6 per cent institutional banking, and 3.7 per cent consumer loans. Its actual mortgage loss rate is two basis points or $35 million, up by $3 million compared to the last half.
Yet Westpac chief executive Brian Hartzer assured investors that the problems are largely contained in areas reliant on the resources industry.
"While there have been a small number of large firms experiencing difficulties during the first half, these have been predominantly due to company-specific issues that have been, in some cases, exacerbated by the mining cycle," he said. "Company balance sheets are generally in good shape—having used lower interest rates to pay down debt – and levels of stress remain low."
Around the country, 90+ days delinquencies including impaired mortgages rose from 45 basis points in the September half to 55 basis points this half. Still, Hartzer believes that other aspects of the Australian economy are encouraging.
"The recent firming of commodity prices, solid employment growth—particularly in the services sectors – and ongoing low interest rates all support that outlook," he said. "We also see signs of moderating housing investment, although housing fundamentals remain in good shape."
