2021-12-13 GC Agenda - Item 8 -Attachment 1 - Housing Needs Assessment

Housing stock in Noosa is noticeably dominated by medium to large detached houses plus semi-
attached or attached housing of at least three bedrooms. Older units are more likely to be two
bedrooms.
Since the turn of the 21st century Noosa Shire has experienced low levels of development as
developable land is depleted. Housing, in all forms, is limited and as demand outstrips supply, more
and more members of the community struggle to find housing suitable to their needs and
circumstances.
As the cost of land has significantly increased over the last couple of decades, the construction cost
of individual dwellings has also noticeably increased with a smaller number of high-end units being
developed in preference over a higher number of small modest units. In some cases, lots which
could yield two or three dwellings are developed for one new house and separate adjoining house
blocks have been bought and consolidated to allow for a larger home and outdoor recreation space.
The property sector has evolved to meet the increased expectation of home buyers and investors,
in a manner that maximises profitability. Consumer expectations of the 1970s and even 80s were
quite low compared to today. A larger floor plate results in more bedrooms, more bathrooms, multiple
living areas, outdoor entertainment areas and a double lock up garage.
Conversely the majority of households are made up of just one or two people1 and there is no
expectation this would change. However even small households with the means prefer larger
dwellings for both resale investment and for the ability to accommodate guests.
Over many decades subsequent Council decision makers have reflected the community wishes in
protecting the natural values of Noosa Shire and the lifestyle afforded by those values by ensuring
large tracts of open space, low rise / low scale development, quality built form and landscaping
provisions and an absence of city symbols. Unlike other local government areas Noosa Shire has
not depended on a momentum of growth and large scale, high rise and high density development
proposals have been rejected on the basis that they represented an overdevelopment of their site
and did not respect the scale or character of their neighbourhood.
Since the completion of the Briggs & Mortar report there have been significant changes within the
housing market throughout Australia. Interest rates have been exceptionally low and borrowing for
investment houses or holiday homes has become a favoured form of investment. Negative gearing
continues to offer tax benefits and is not likely to be wound back in the near future. While interest
rates are low and return on savings negligible, purchase prices are high so saving a 20% deposit
makes purchasing particularly difficult for first home buyers.
The Reserve Bank of Australia has published a research discussion paper2 that shows housing
prices are typically more sensitive to changes in interest rates in areas where land is limited and
more expensive. They suggest that lower interest rates increase housing wealth inequality, while
higher rates do the opposite.
Following a referral in July 2021, the Federal House of Representatives Standing Committee on Tax
and Revenue is conducting an inquiry into the contribution of tax and regulation on housing
affordability and supply, specifically they will—
•     Examine the impact of current taxes, charges and regulatory settings at a Federal, State and
      Local Government level on housing supply;
•     Identify and assess the factors that promote or impede responsive housing supply at the
      Federal, State and Local Government level; and




1 2016 median occupancy rate was 2.4 persons
2 Calvin He and Gianni La Cava (2020) “The Distributional Effects of Monetary Policy: Evidence from Local

Housing Markets”, a RBA Research Discussion Paper



Noosa Housing Needs Assessment 2021                                                              Page 14