The Conversation

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More than ever as we emerge from the crisis we are going to have to get the most out of our economy.

Swapping stamp duty for land tax as the <a href="https://theconversation.com/abolish-stamp-duty-the-act-shows-the-rest-of-us-how-to-tax-property-105378">ACT government</a> is doing (over 20 years) and the <a href="https://www.treasury.nsw.gov.au/sites/default/files/2020-11/NSW%20TSY%20TF%20-%20Glossy.pdf">NSW government</a> is planning (using an opt-in arrangement), is one of the best ways the tax system can help.

This graph from the federal treasury’s 2015 <a href="https://treasury.gov.au/sites/default/files/2019-03/c2015-rethink-dp-TWP_combined-online.pdf">tax discussion paper</a> makes the point.

It says the “marginal excess burden” (damage) done by real estate stamp duty amounts to 70 cents for each dollar raised.

It discourages people and businesses from changing addresses as often as they should, meaning workers live further away from their work than they would and are reluctant to move to where there is better work.

<figure class="align-center zoomable"><a href="https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=1000&amp;fit=clip"><img alt="" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px" src="https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;fit=clip" srcset="https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=600&amp;h=397&amp;fit=crop&amp;dpr=1 600w, https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=30&amp;auto=format&amp;w=600&amp;h=397&amp;fit=crop&amp;dpr=2 1200w, https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=15&amp;auto=format&amp;w=600&amp;h=397&amp;fit=crop&amp;dpr=3 1800w, https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=45&amp;auto=format&amp;w=754&amp;h=498&amp;fit=crop&amp;dpr=1 754w, https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=30&amp;auto=format&amp;w=754&amp;h=498&amp;fit=crop&amp;dpr=2 1508w, https://images.theconversation.com/files/370724/original/file-20201123-19-16bujkx.jpg?ixlib=rb-1.1.0&amp;q=15&amp;auto=format&amp;w=754&amp;h=498&amp;fit=crop&amp;dpr=3 2262w"></a>

<figcaption><a class="source" href="https://treasury.gov.au/sites/default/files/2019-03/c2015-rethink-dp-TWP_combined-online.pdf">Tax discussion paper, Australian Treasury March 2015</a></figcaption></figure>In contrast, treasury found the marginal excess burden of land tax was negative. Land tax makes sure land was used for its most useful purpose and not left idle.

Efficiency-wise it makes sense to swap one for the other, but as with all changes there will be winners and losers, some of them surprising.

In our <a href="https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3760893">just-published study</a>, we use real-world data on living arrangements from the Melbourne Institute’s <a href="https://melbourneinstitute.unimelb.edu.au/hilda">Household, Income and Labour Dynamics in Australia</a> survey and data on house prices and stamp duty rates from the Real Estate Institute Australia in an attempt to work out who the winners and losers will be.

<h2>Good for the young, and the old</h2>

We find that overall the swap should reduce the purchase price for home buyers, increase the sale price for sellers, increase the total number of transactions and reduce the degree of mismatch in housing.

It should also increase the rate of home ownership.

Young adults, particularly those who are currently having difficulty saving for a deposit would be better off.

Current homeowners would generally be worse off.

Renters would benefit because they are currently excluded from home ownership.

Older landlords, perhaps surprisingly, would also benefit. In many cases the increase in the value of their houses would outweigh the cost of the land tax.

Our findings raise a challenge for governments.

In the long run, the swap would improve the working of the economy, but in the short run it will hurt many current voters.

A gradual transition – either through a very long phase in (of the kind adopted by the ACT) or by allowing households to select into different tax systems (as NSW is planning) would help make the switch more palatable.

But the sooner we start, the better.<img alt="The Conversation" height="1" src="https://counter.theconversation.com/content/154935/count.gif?distributor=republish-lightbox-basic" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" width="1">

 

This article is republished from <a href="https://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/identifying-the-losers-and-surprising-winners-from-phasing-out-stamp-duty-154935">original article</a>.

 
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Swapping stamp duty for land tax as the ACT government is doing and the NSW government is planning, is one of the best ways the tax system can help our economy

max.kwok_55688

Identifying the losers (and surprising winners) from phasing out stamp duty

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By <a href="https://theconversation.com/profiles/brian-feeney-317083">Brian Feeney</a>, <a href="http://theconversation.com/institutions/the-university-of-queensland-805">The University of Queensland</a>.

Growing the economy – not city planning – has become the government’s main rationale for building urban transport infrastructure.

Soon after becoming prime minister in September 2015, Malcolm Turnbull <a href="http://www.sbs.com.au/news/article/2015/10/11/turnbull-i-want-be-infrastructure-prime-minister">declared</a>:

<blockquote>
I will be an infrastructure prime minister.
</blockquote>

Subsequently, his government’s focus seems to be largely on infrastructure projects – including urban transport infrastructure – <a href="https://www.pm.gov.au/media/2016-02-17/launch-infrastructure-australia-plan">“which drive … growth and jobs”</a>.

Transport infrastructure is seen as a facilitator of growth and competitiveness in our cities. This is where much of <a href="https://theconversation.com/how-to-make-cities-work-better-heres-what-the-government-needs-to-do-61668">Australia’s economic growth</a> is generated. But, while important, promoting economic growth is not transport’s only major function.

<h2>Increasingly divorced from city planning</h2>

Until recently, it was generally accepted that urban transport and land development needed to be <a href="https://theconversation.com/australian-infrastructure-plan-has-some-way-to-go-to-give-our-cities-what-they-need-54954">planned in an integrated way</a>, having regard to what city future was desired. Transport infrastructure investment would then help to achieve that city future.

While city planning was once a <a href="https://books.google.com.au/books?id=lqEDQlUgWZEC&amp;pg=PA129&amp;lpg=PA129&amp;dq=the+raison+d%E2%80%99etre+of+planning+as+a+tool+for+correcting+and+avoiding+market+failure&amp;source=bl&amp;ots=FTAVZqRzyP&amp;sig=n5NMKzf57BZ29TPCsOLVl_jtaII&amp;hl=en&amp;sa=X&amp;ved=0ahUKEwjI1LWiqubPAhVOzWMKHVpSCz4Q6AEIJDAB#v=onepage&amp;q=the%20raison%20d%E2%80%99etre%20of%20planning%20as%20a%20tool%20for%20correcting%20and%20avoiding%20market%20failure&amp;f=false">“tool for correcting and avoiding market failure”</a>’, it is now much more about <a href="http://www.isocarp.net/Data/case_studies/2412.pdf">promoting economic growth</a> by providing certainty for the development industry and reducing regulation.

Under this increasingly dominant view, city planning (by governments) is seen as a generally distorting influence on property markets. Regulation is a <a href="http://www.isocarp.net/Data/case_studies/2412.pdf">“transaction cost”</a>.

Major urban transport investment is increasingly divorced from achieving broader city planning objectives. This includes equitable access to services and facilities.

For example, <a href="http://www98.griffith.edu.au/dspace/bitstream/handle/10072/29803/56942_1.pdf?sequence=1">there is a disconnect</a> between the TransApex major road program and urban planning in southeast Queensland. This program of four major road projects in Brisbane aimed to improve cross-city travel and keep the economy strong. However, TransApex was at odds with the <a href="http://www.dilgp.qld.gov.au/resources/plan/seq/regional-plan-2009/seq-regional-plan-2009.pdf">southeast Queensland regional plan’s aim</a> of promoting sustainability and reducing car dependency.

<h2>Cost-benefit analysis is preferred</h2>

Instead of an integrated city planning approach, governments are increasingly basing transport investment decisions on cost-benefit analyses.

Cost-benefit analysis for transport projects involves weighing up the costs (construction and operating costs) and benefits (travel time savings, vehicle operating cost savings, crash cost savings and wider economic benefits). If the dollar value of the benefits exceeds the costs, the project is considered justified.

It has <a href="http://grattan.edu.au/wp-content/uploads/2016/04/869-Roads-to-Riches.pdf">recently been suggested</a> that all transport projects where benefits exceed costs by some margin should be built, apparently with little regard to the effects of those projects on city planning.

The significant limitations of cost-benefit analyses are <a href="http://www.ase.tufts.edu/gdae/Pubs/rp/Ack_UK_CBAcritique.pdf">well documented</a>. It is particularly troubling that, for transport projects, these analyses rely on a <a href="https://theconversation.com/modelling-for-major-road-projects-is-at-odds-with-driver-behaviour-63603">flawed assumption</a> that motorists aim to minimise generalised costs.

Cost-benefit analyses also provide limited guidance in deciding which projects <a href="https://www.sgsep.com.au/about/latest-news/what-will-change-game">advance broader city planning objectives</a>.

<h2>Transport decisions are about values</h2>

Decisions about transport investments are really about <a href="https://theconversation.com/australian-infrastructure-plan-has-some-way-to-go-to-give-our-cities-what-they-need-54954">what kind of future city</a> we desire.

These are decisions about values as much as they are about economics. American philosopher Michael Sandel is concerned that conversations about the future are largely framed in technocratic (often economic) terms. This leaves public discourse “<a href="http://mpegmedia.abc.net.au/rn/podcast/2013/05/bst_20130523_0831.mp3">hollowed out</a>”.

<figure class="align-right zoomable"><a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/148793/area14mp/image-20161206-25738-1osyhh3.jpg"><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/148793/width237/image-20161206-25738-1osyhh3.jpg"></a>

<figcaption>The Gold Coast light rail project neglected the social equity effects of a roughly $1 billion public investment. AAP/Dave Hunt</figcaption></figure>The social equity effects of transport investment are not usually taken into account. The public investment of about A$1 billion in the Gold Coast light rail disproportionately <a href="https://theconversation.com/gold-coast-light-rail-study-helps-put-a-figure-on-value-captures-funding-potential-65084">benefits residents, landowners and businesses</a> close to the stations. Other Gold Coast residents – including many disadvantaged people – have to drive or make do with a relatively low-quality bus service.

With cities now urged to <a href="https://en.wikipedia.org/wiki/City_marketing">market themselves</a>, “flagship” projects like the light rail are valued as means of giving cities an advantage in a world of footloose businesses and investors. These projects are considered important for growing the economy.

The Gold Coast light rail is an 18-year public-private partnership (PPP). PPP contracts frequently include <a href="https://books.google.com.au/books?id=jmeSmr0n6RMC&amp;pg=PA32&amp;lpg=PA32&amp;dq=public+private+partnerships+non-competition+clause&amp;source=bl&amp;ots=tZh6LMF-KK&amp;sig=gm_FDjXW143ZD8Ue3Dww3N3amPk&amp;hl=en&amp;sa=X&amp;ved=0ahUKEwi1kpKbkLbQAhWDi5QKHcydB60Q6AEIJTAB#v=onepage&amp;q=public%20private%20partnerships%20non-competition%20clause&amp;f=false">“non-compete” clauses</a> (no new competition with the PPP infrastructure). These can constrain future city planning decisions, however desirable they may be.

<h2>‘Splintered’ development is poor planning</h2>

The influence of cost-benefit analysis, city marketing and PPPs works against an integrated approach to land use and transport planning.

This situation can be described as <a href="http://www98.griffith.edu.au/dspace/bitstream/handle/10072/29803/56942_1.pdf?sequence=1">“splintered” infrastructure development</a> and raises questions about its impacts on the achievement of broader city planning objectives. While individual infrastructure investments with a positive benefit-cost ratio may help grow the economy, the idea that this will trickle down to better social or environmental outcomes for city residents is problematic.

It doesn’t have to be like this. One <a href="https://www.propertyobserver.com.au/https://www.planning.org.au/documents/item/281">policy proposal</a> for Adelaide offers examples of how transport and land use can be better integrated to support an overall city vision.

New transport infrastructure will clearly be needed in Australia’s growing capital cities just to maintain current levels of accessibility. There will be plenty of scope for Turnbull to leave a legacy of transport infrastructure that not only helps grow the economy but also supports integrated city planning.<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/69880/count.gif?distributor=republish-lightbox-basic" width="1">

<a href="https://theconversation.com/profiles/brian-feeney-317083">Brian Feeney</a> is an Urban Planning Researcher at <a href="http://theconversation.com/institutions/the-university-of-queensland-805">The University of Queensland</a>.

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/turnbulls-report-card-on-urban-transport-projects-reveals-narrow-economic-focus-69880">original article</a>.

Lead image credit: <a href="https://www.propertyobserver.com.au/https://twitter.com/TurnbullMalcolm/status/649700119806214144/photo/1?ref_src=twsrc%5Etfw">Malcolm Turnbull on Twitter</a>.
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theconversation

Turnbull’s report card on urban transport projects reveals narrow economic focus

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By <a href="https://theconversation.com/profiles/alexei-trundle-11956">Alexei Trundle</a>, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>; <a href="https://theconversation.com/profiles/andre-stephan-14991">André Stephan</a>, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>; <a href="https://theconversation.com/profiles/hayley-henderson-288490">Hayley Henderson</a>, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>; <a href="https://theconversation.com/profiles/hesam-kamalipour-288498">Hesam Kamalipour</a>, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>, and <a href="https://theconversation.com/profiles/melanie-lowe-288493">Melanie Lowe</a>, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>.

The <a href="https://www.propertyobserver.com.au/https://www2.habitat3.org/file/535859/view/588897">New Urban Agenda</a> was officially adopted in Quito, Ecuador in the last plenary of the <a href="https://habitat3.org">Habitat III</a> conference.

The agenda provides a <a href="https://theconversation.com/habitat-iii-the-biggest-conference-youve-probably-never-heard-of-63499">20-year “roadmap”</a> to guide sustainable urban development globally.

The text of the New Urban Agenda itself was agreed well before Habitat III at the UN General Assembly <a href="http://sdg.iisd.org/events/informal-negotiations-on-habitat-iii-outcome-document/?rdr=sd.iisd.org">in September</a>, during an extraordinary informal negotiation session that lasted for <a href="http://citiscope.org/habitatIII/news/2016/09/final-burst-talks-results-consensus-draft-new-urban-agenda">more than 30 hours</a>.

This allowed the focus in Quito to shift towards commitment and action. Under the banner of the “<a href="https://habitat3.org/quito-implementation-plan">Quito Implementation Plan</a>”, commitments ranged from the development and enhancement of <a href="http://unhabitat.org/mayor-sally-lee-sorsogon-launches-addressing-climate-change-in-national-urban-policy-publication-at-habitat-iii/">national urban policies</a>, to integration between <a href="http://www.un.org/pga/71/2016/10/16/world-mayors-assembly-of-habitat-iii/">different levels of government</a>.

The conference also saw announcements of new sources of <a href="https://habitat3.org/programme/habitat-for-humanitys-launch-of-commitments-under-the-quito-implementation-plan/">international development assistance</a> for countries to provide better access to housing and shelter for millions more people worldwide.

<h2>Sustainable urban development for all</h2>

<a href="https://esa.un.org/unpd/wup/Publications/Files/WUP2014-Highlights.pdf">More than half</a> of the world’s population now lives in cities. So it makes sense that the New Urban Agenda will significantly shape the <a href="https://sustainabledevelopment.un.org/post2015/transformingourworld">UN 2030 Agenda for Sustainable Development</a>.

The 2030 agenda is built around a series of Sustainable Development Goals (SDGs). Most relevant to the New Urban Agenda is <a href="http://www.un.org/sustainabledevelopment/cities/">SDG 11</a>, which aims to “make cities and human settlements inclusive, safe, resilient and sustainable”. However, the New Urban Agenda has been <a href="http://www.citiesalliance.org/sites/citiesalliance.org/files/Opportunities%20for%20the%20New%20Urban%20Agenda.pdf">criticised</a> for lacking direct links to the <a href="https://sustainabledevelopment.un.org/sdg11">targets</a> set out within Goal 11.

<blockquote class="twitter-tweet" data-lang="en">
What are the <a href="https://twitter.com/hashtag/globalgoals?src=hash">#globalgoals</a>? The full list is here. <a href="https://t.co/wS27ckOzeE">https://t.co/wS27ckOzeE</a> <a href="https://t.co/nkJkpJQU7z">pic.twitter.com/nkJkpJQU7z</a>
— UN Foundation (@unfoundation) <a href="https://www.propertyobserver.com.au/https://twitter.com/unfoundation/status/789534481464102912">October 21, 2016</a>
</blockquote>

Unlike their predecessors the <a href="http://www.unmillenniumproject.org/goals/">Millennium Development Goals</a>, the SDGs apply to all UN members states equally.

While most of the world’s rapid urban growth is in the Global South, challenges abound in the cities of Europe, North America, Australia, New Zealand and East Asia. In these regions, upgrading existing infrastructure and avoiding “<a href="https://www.sei-international.org/mediamanager/documents/Publications/Climate/SEI-WP-2015-11-C40-Cities-carbon-lock-in.pdf">carbon lock-in</a>” - where old, carbon-intensive structures prevent the adopting of lower carbon alternatives – will require significant transformative efforts.

Much of Habitat III focused on the application of new technologies and the harvesting of big data, particularly in these established urban centres. Under the umbrella of <a href="https://www.propertyobserver.com.au/http://www.thefifthestate.com.au/articles/data-driven-cities-a-key-to-the-habitat-iii-new-urban-agenda/85843">Smart Cities</a>, using open data networks for better urban planning provided an optimistic, technology-based future for cities. However, questions about the security, ethics, and oversight of large-scale information gathering remain largely <a href="http://cityminded.org/smart-technology-ethics-15967">unanswered</a>.

<figure class="align-center zoomable"><a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/142709/area14mp/image-20161021-1763-oabs20.jpg"><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/142709/width754/image-20161021-1763-oabs20.jpg"></a>

<figcaption>Melbourne, Australia, is consistently rated as the world’s ‘most liveable city’, but it’s also very carbon intensive. Alexei Trundle</figcaption></figure>Also included in the New Urban Agenda are renewed efforts to help developing countries urbanise. These build on earlier work under the <a href="http://www.unmillenniumproject.org/goals/">Millennium Development Goals</a> and <a href="http://www.un.org/en/development/devagenda/habitat.shtml">Habitat II</a>. Related commitments focus on emerging concepts, such as <a href="http://www.iclei.org/details/article/iclei-launches-resilient-cities-report-2016">urban resilience</a> and <a href="http://citiscope.org/habitatIII/commentary/2016/10/placemaking-and-promise-new-urban-agenda">inclusive public spaces</a>.

Commitments from individual countries under the Quito Implementation Plan <a href="http://citiscope.org/habitatIII/news/2016/10/official-commitments-new-urban-agenda-slow-start?utm_source=Citiscope&amp;utm_campaign=4901066977-Mailchimp_Quito_2016_10_19&amp;utm_medium=email&amp;utm_term=0_ce992dbfef-4901066977-118056697">were underwhelming</a>. Instead, civil society and academia led the way with a range of commitments to <a href="http://citiscope.org/habitatIII/news/2016/10/habitat-iii-ngo-makes-major-commitments-strengthen-access-housing">new initiatives</a>. This included a new $15 million <a href="https://habitat3.org/programme/habitat-for-humanitys-launch-of-commitments-under-the-quito-implementation-plan/">Terwilliger Centre for Innovation in Shelter</a> funded by Habitat for Humanity, and $2.3 million by the <a href="http://citiscope.org/habitatIII/news/2016/10/fund-seeks-strengthen-climate-action-cities">C40 Cities Finance Facility</a> to upscale urban climate action. A full list of commitments to the Quito Implementation Plan can be found on the <a href="https://habitat3.org/quito-implementation-plan">Habitat III website</a>.

Despite references to <a href="http://unctad.org/en/pages/aldc/Least%20Developed%20Countries/UN-list-of-Least-Developed-Countries.aspx">Least Developed Countries</a> and <a href="https://sustainabledevelopment.un.org/topics/sids">Small Island Developing States</a> in the agenda, support for sustainable urbanisation in areas such as the Pacific was limited. As noted by one Pacific delegate:

<blockquote>
There are not enough people talking about the Pacific, and the Pacific’s problems with urbanisation. We don’t have the means, but we are the ones being heavily impacted by disasters and climate change.
</blockquote>

The role of partnerships between city authorities and universities in the Global South and their more developed neighbours was also strongly emphasised. UN-Habitat is soon to release a Higher Education <a href="https://habitat3.org/programme/hesi-global-meeting-of-universities-action-plan-for-universities-to-maximize-impact-of-higher-education-in-the-sustainability-of-urbanization/">Action Plan</a>.

<figure class="align-center "><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/142715/width754/image-20161021-1763-n6gba7.JPG"><figcaption>Participants in a training session on urban climate action planning in Small Island Developing States. Bernhard Barth, UN-Habitat</figcaption></figure><h2>Was Habitat III a success?</h2>

Views on the success of the conference varied among Habitat III’s <a href="http://www.un.org/apps/news/story.asp?NewsID=55360">36,000</a> participants. This was perhaps inevitable given the contested nature of cities and urban space.

A clear highlight was the participation of countless young Quito residents. Many attended side events and UN-Habitat’s <a href="https://habitat3.org/programme/children-and-youth-assembly/">Youth Assembly</a>. The continued growth in the role of civil society, mayors and advocacy groups is a positive trend that should be supported.

<figure class="align-center "><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/142745/width754/image-20161022-1773-nb4d93.JPG"><figcaption>Young Quiteñas and Quiteños participate in a UN-Habitat Training Session. Bernhard Barth, UN-Habitat</figcaption></figure>The parallel <a href="http://citiscope.org/habitatIII/news/2016/10/alternative-forums-offer-urban-visions-outside-habitat-iii">Alternative Habitat</a> forums provided a platform for challenging some of the consensus-based narratives.

Bridging these official and unofficial events was the launch of <a href="http://www.newyorker.com/business/currency/top-down-bottom-up-urban-design">the Quito Papers</a>. Authored by a trio of world-renowned urban experts, The Quito Papers provide an alternative vision for cities of the future.

Unlike the <a href="http://www.getty.edu/conservation/publications_resources/research_resources/charters/charter04">Charter of Athens</a>, which likened cities to machines, the Quito Papers consider cities as adaptive and evolving open systems. These papers urge decision-makers to give cities back to the people that inhabit them, and promote equality and socially interactive spaces.

<h2>Towards Habitat IV</h2>

All countries will need to step up their commitments if the aspirations set out in Habitat III are to be achieved. Key concepts, such as integrated planning and models for local-national government cooperation, will need further work.

Although Habitat IV will not take place until 2036, a four-yearly review process has been agreed upon, building on the biannual <a href="http://unhabitat.org/wuf/">World Urban Forum</a>.

Also included in the New Urban Agenda is a review of UN-Habitat’s role in its implementation. It is not yet known whether a new “<a href="http://citiscope.org/habitatIII/news/2016/08/un-cities-rumoured-proposal-gains-steam">UN-Cities</a>” entity will emerge when the review concludes in 2017.

From a planning perspective, 20 years is a short space of time to change the trajectory of global cities. However, the unplanned changes in our cities over the next two decades are almost equally unimaginable.

With the New Urban Agenda as a road map, it is hoped that we can rise to the challenge of creating more liveable, resilient and sustainable cities. Because without global urban transformation, we cannot achieve sustainable development as a whole.<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/67432/count.gif?distributor=republish-lightbox-basic" width="1">

<a href="https://theconversation.com/profiles/alexei-trundle-11956">Alexei Trundle</a>, PhD Candidate, Australian-German Climate &amp; Energy College, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>; <a href="https://theconversation.com/profiles/andre-stephan-14991">André Stephan</a>, Postdoctoral Research Fellow, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>; <a href="https://theconversation.com/profiles/hayley-henderson-288490">Hayley Henderson</a>, PhD Candidate in Urban Planning, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>; <a href="https://theconversation.com/profiles/hesam-kamalipour-288498">Hesam Kamalipour</a>, PhD Candidate and Research Assistant in Urban Design, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>, and <a href="https://theconversation.com/profiles/melanie-lowe-288493">Melanie Lowe</a>, Research Fellow, McCaughey VicHealth Community Wellbeing Unit, Melbourne School of Population and Global Health, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>.

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/habitat-iii-is-over-but-will-its-new-urban-agenda-transform-the-worlds-cities-67432">original article</a>.
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Habitat III is over, but will its New Urban Agenda transform the world's cities?

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By <a href="https://theconversation.com/profiles/emma-baker-172081">Emma Baker</a>, <a href="http://theconversation.com/institutions/university-of-adelaide-1119">University of Adelaide</a>; <a href="https://theconversation.com/profiles/andrew-beer-111469">Andrew Beer</a>, <a href="http://theconversation.com/institutions/university-of-south-australia-1180">University of South Australia</a>, and <a href="https://theconversation.com/profiles/rebecca-bentley-173502">Rebecca Bentley</a>, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>.

Truth be told, most Australians live in good housing. This is good news for all of us because our housing is a major determinant of our health and wellbeing. But our very recent <a href="http://www.tandfonline.com/doi/full/10.1080/10852352.2016.1197714">research findings</a>, published this month in the Journal of Prevention and Intervention in the Community, and the lessons of history tell us this good news story is at risk.

Ideally, housing provides us with the secure, comfortable shelter that people and their families need to live healthy, productive lives. In general, we have a modern housing stock with good heating and cooling, few major structural problems and few problems with damp and mould. By contrast, bad housing makes it much more likely you will get sick and stay sick once ill.

In Australia’s early years, much of the housing stock was of poor quality, often overcrowded, and posed real risks to people’s health. Slums were common in the inner parts of the major cities and in many country towns.

<figure><iframe allowfullscreen="" frameborder="0" height="300" scrolling="no" src="https://www.youtube.com/embed/AoYxCZiqAik?wmode=transparent&amp;start=0" width="100%"></iframe>

<figcaption>Scenes from the Fitzroy slums in Melbourne in the early 20th century.</figcaption></figure>As late as 1915 <a href="https://www.emknowledge.org.au/resource/194/1900/epidemic---bubonic-plague-australia-wide-1900-1925">bubonic plague was a reality</a> in the poorer parts of our cities and other contagious diseases remained an ever-present risk. Numerous letters to the editor documented a real social concern with the housing standards of the poor.

Government intervention, economic prosperity and tenancy laws all improved housing conditions across Australia. Within a century Australia was defined by good housing and high rates of home ownership. The nation <a href="http://blogs.slv.vic.gov.au/such-was-life/the-slums-of-melbourne/">saw off the last of its slums</a> in the late 1940s.

Now the same conditions that gave rise to substandard housing in the 19th century are returning in the 21st, with a likely similar outcome. Recently, the Reserve Bank governor acknowledged young Australians <a href="http://www.smh.com.au/business/the-economy/rba-chief-glenn-stevens-says-children-need-help-from-parents-to-enter-sydney-property-market-20160816-gqu4wk">need their parents' help</a> to buy a home in Sydney. But most Australians don’t have a wealthy and doting parent to fund them into the house of their dreams.

The alternative is to live in lower-quality housing and to make do with a home that is relatively inaccessible, fundamentally unaffordable or both.

<h2>A million Australians on the housing brink</h2>

The confronting reality is that poor housing conditions are more prevalent in Australia than we think.

We have a sizeable “hidden fraction” of Australians living in poor-quality housing. In particular, many of our most vulnerable have the double disadvantage of also having housing conditions that we might deem as falling below an unacceptable standard.

In one of the few contemporary analyses of this issue, we used the Household Income and Labour Dynamics (<a href="https://www.melbourneinstitute.com/hilda/">HILDA</a>) Survey, a national longitudinal dataset, and find compelling evidence of a substantial stock of poor-quality housing in Australia.

The scale of our findings is somewhat surprising: we found almost a million Australians are living in poor or very-poor-quality housing. Within this total, more than 100,000 are residing in dwellings regarded as very poor or derelict.

These simple findings are important. They show the existence of a significant (and currently little known) population of individuals living in very poor conditions. At the very least, we need to monitor Australian housing conditions in a systematic way if we are to avoid this problem worsening.

<h2>Harms of poor housing multiply</h2>

Poor-quality housing makes the already disadvantaged even worse off. Younger people, people with disabilities and ill health, those with low incomes, those without full-time (or any) employment, Indigenous people and renters are much more likely to be found in the emerging slums of 21st-century Australia.

Importantly, many of these groups are already disadvantaged and (most probably) have a pressing need for housing that improves or supports their health and wellbeing. People with an existing illness or disability, for example, are almost twice as likely to live in dwellings in very poor condition as people without a disability or illness.

These findings about the size and uneven distribution of the problem should force us to ask what effects poor-quality housing has on people – on their mental, physical and general health? It is clear from our analysis that such housing has measurable impacts on mental, physical and general health. This impact is large enough to be statistically significant.

Given the time it takes to reform policy and plan for our cities and regions, Australia urgently needs to face up to the dismal reality that once again many Australians are living in housing not fit for habitation.

Governments must take steps to ensure the supply of affordable housing of reasonable quality. Otherwise, we are destined to become a nation scarred once again by slums, reduced life chances and shortened lives.<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/64153/count.gif" width="1">

<a href="https://theconversation.com/profiles/emma-baker-172081">Emma Baker</a>, Associate Professor, School of Architecture and Built Environment, <a href="http://theconversation.com/institutions/university-of-adelaide-1119">University of Adelaide</a>; <a href="https://theconversation.com/profiles/andrew-beer-111469">Andrew Beer</a>, Dean, Research and Innovation, <a href="http://theconversation.com/institutions/university-of-south-australia-1180">University of South Australia</a>, and <a href="https://theconversation.com/profiles/rebecca-bentley-173502">Rebecca Bentley</a>, Associate Professor, Centre for Health Equity, Melbourne School of Population and Global Health, <a href="http://theconversation.com/institutions/university-of-melbourne-722">University of Melbourne</a>.

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/why-100-years-without-slum-housing-in-australia-is-coming-to-an-end-64153">original article</a>.

Lead image credit: <a href="https://www.flickr.com/photos/statelibraryofvictoria_collections/7007477611/in/photolist-bFe9Xv-bsjgtf-bFe9Yv-bFe9Wr-bsjgy1-9MiKSE">State Library of Victoria/Flickr</a>
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Why 100 years without slum housing in Australia is coming to an end

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<a href="http://theconversation.com/profiles/emma-baker-172081">Emma Baker</a>; <a href="http://theconversation.com/profiles/andrew-beer-111469">Andrew Beer</a>, <a href="http://theconversation.com/institutions/university-of-south-australia">University of South Australia</a>, and <a href="http://theconversation.com/profiles/rebecca-bentley-173502">Rebecca Bentley</a>, <a href="http://theconversation.com/institutions/university-of-melbourne">University of Melbourne</a>

In his 1972 election campaign, Gough Whitlam <a href="http://whitlamdismissal.com/1972/11/13/whitlam-1972-election-policy-speech">loudly proclaimed</a> that in modern Australia an individual’s health, wellbeing and life chances were shaped more by where they lived than by the job they held, their religion, race or ethnicity.

It was a powerful statement that spoke to an Australian population scarred by decades of urban growth unsupported by the infrastructure needed to make places decent, worthwhile environments to raise children, live a productive life and contribute to society.

Fast-forward almost 50 years and urban issues are once again on the agenda. Prime Minister Malcolm Turnbull’s <a href="https://cities.dpmc.gov.au/smart-cities-plan">Smart Cities Plan</a> would deliver new transport infrastructure, better urban planning, and the sort of “urban visioning” that earned Whitlam praise and damnation in equal measure.

But there is a big difference this time around. The Whitlam agenda was informed by a fundamental concern with social justice, a desire to improve the lot in life of the most deprived, and a belief in a fairer Australia.

The 2016 articulation of an urban agenda has no such commitment to social ideals. Instead, it assumes building more highways, railways and trams will produce better, more productive cities that somehow give everyone a job.

We know it doesn’t work that way. Our <a href="http://authors.elsevier.com/a/1T8V6Wf-Aydxr">recent research</a> has highlighted both the unequal nature of Australia’s cities and the processes that keep poor places poor.

<h2>Upwardly and downwardly mobile</h2>

On average, about 15% of Australians move house each year. Generally, when they move they shift to places that are a bit better than the places they left – that is, places with good access to employment, quality environments, and social settings.

Our research suggests, however, that this statistical average hides a very interesting two-speed process that is neglected by the Smart Cities Plan. The relatively well-off and the upwardly mobile improve the areas in which they live over an extended period. The more economically vulnerable tend to make more frequent, multiple moves – living in slightly less advantaged areas each time.

To put it in plain terms, the poor move to poor areas where they may become even more disadvantaged. Meanwhile, the middle classes move through our cities gradually climbing the housing ladder.

This process has immediate as well as intergenerational implications, gradually filtering some families into areas with fewer and fewer opportunities, poorer educational outcomes, higher transport costs and few resources to deal effectively with health conditions. In some cases, jobs can’t be found, or are simply too far away to be practical.

<h2>Housing affordability widens the gap</h2>

In the current climate of ongoing <a href="https://theconversation.com/our-cities-will-stop-working-without-a-decent-national-housing-policy-60537">housing affordability “crisis”</a> and highly localised house price differentiation, more and more Australians are forced to move through the market because of the (un)-affordability of their housing. Housing affordability should be a key question when we think about our cities.

In our <a href="http://authors.elsevier.com/a/1T8V6Wf-Aydxr">new paper</a>, we examine if housing affordability problems are concentrating some people into less advantaged areas. When we track the residential mobility of Australians, we find that housing affordability is “sorting” some people into more and less advantaged places.

Australia’s housing affordability problems are much more complex than simple supply problems. Cities are shaped by the people who live within them. Some people need <a href="https://theconversation.com/a-national-affordable-housing-strategy-necessary-attainable-and-maybe-on-its-way-49943">affordable housing responses</a> that are smarter than the market alone <a href="https://theconversation.com/are-we-seeing-a-new-dawn-for-affordable-housing-52286">can supply</a>.

Our work indicates that some people’s access to the good things smart cities have to offer is limited by the location of housing they can afford – be it ownership or rental.

Smart cities of the future will need to address the consequences of housing-generated social and economic inequalities in Australia.

<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/61213/count.gif" width="1">

<a href="http://theconversation.com/profiles/emma-baker-172081">Emma Baker</a>, Reader in Housing; <a href="http://theconversation.com/profiles/andrew-beer-111469">Andrew Beer</a>, Dean, Research and Innovation, <a href="http://theconversation.com/institutions/university-of-south-australia">University of South Australia</a>, and <a href="http://theconversation.com/profiles/rebecca-bentley-173502">Rebecca Bentley</a>, Associate Professor, Centre for Health Equity, Melbourne School of Population and Global Health, <a href="http://theconversation.com/institutions/university-of-melbourne">University of Melbourne</a>

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/smart-cities-wouldnt-let-housing-costs-drive-the-worse-off-into-deeper-disadvantage-61213">original article</a>.

Lead image credit: <a href="https://www.flickr.com/photos/wallyonwater54/21180570241/in/photolist-ygDXBx-wHvxwM-vMvBs6-vgazZB-vVxt6R-vZ9H12-vGDV4D-vD9841-vnfkWM-sy8qs1-scYLZm-rrNMNK-s73v3S-qA8Awp-xMd2dp-q6S6mb-p5H5u9-pb9Svf-nCnSEw-nCjrVK-nxeSDv-kFLMXF-kp1WVg-kLrbMR-iNr9uj-iSeYZ2-iMc7MT-iMc4b4-iM6Qt2-sosgzs-CopiUh-qA2vBY-qSqGWk-qAaiLe-rgAGF9-qLdn4P-q6Ja7M-oPyn2m-pLu9Ss-oPBuNM-pJjsRE-ptXJHh-pLtYmN-pEKirV-oLkrCd-oDF5zW-oDFtkd-otiriv-o7eSDV-ooHvRD">flickr</a>.
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Smart cities wouldn't let housing costs drive the worse-off into deeper disadvantage

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By <a href="http://theconversation.com/profiles/phillip-oneill-125643">Phillip O'Neill</a>, Director, Centre for Western Sydney, <a href="http://theconversation.com/institutions/university-of-western-sydney">Western Sydney University</a>.

Mounting public debt has sucked infrastructure spending capacity from the nation’s public balance sheets. The federal government proposes a new way forward, called “<a href="https://theconversation.com/city-deals-nine-reasons-this-imported-model-of-urban-development-demands-due-diligence-57040">City Deals</a>”. But the budget papers contain no further details, which is disappointing.

Infrastructure provision in Australian cities, especially for transport, is in crisis. Our cities are growing rapidly, they are congested and they lack planning direction.

The crisis has been elevating for some time. It has many origins – most notably in the aggressive paying down of government debt under four successive Howard governments. Between 1996-97 and 2006-07, net Australian government debt fell by more than A$125 billion. With the sale of Telstra, a further A$50 billion was made available to establish the Australia Future Fund.

There are good arguments for lowering public debt and setting aside savings to cover liabilities for public servant pensions. However, under the Howard government, actions to enhance the liveability of our cities were not given spending priority.

<h2>A continuing story of rising debt</h2>

The election of a Rudd Labor government in 2007 came with the promise of major infrastructure spending on our failing cities.

Instead, a global financial crisis led to the federal government balance sheet exploding with debt to fund massive spending injections and shovel-ready infrastructure projects, especially in the education sector. By the end of the 2013-14 financial year net Australian government debt exceeded A$200 billion.

The Abbott Coalition government eased back on spending with non-metropolitan roads spending preferred to the urgent refits our cities cry for. Now the 2016-17 budget papers tell us debt will exceed A$325 billion in the coming financial year, or 18.9% of GDP. That is Australia’s highest debt ratio in modern times.

When the Howard government was elected in 1996, Australia had just over 18 million residents. Since then another six million have been added; all are urban dwellers.

In this 20 years, Sydney has grown by one million people and Melbourne by 1.2 million; yet neither city has been the target of significant transport infrastructure spending by government. The major transport investment in each city has been by the private sector on motorways.

<h2>Private sector role favours roads</h2>

Look closely at this recent history and perhaps the logic of the City Deals initiative becomes clear. In 1994, the Kennett Coalition government granted Australia’s first tolled-motorway concession to the CityLink consortium.

Motorway deals in New South Wales and Queensland, for all their start-up failures and hiccups, have reproduced the CityLink model in three major ways.

First, they have used private finance to pay for the capital investments required.

Second, users must pay tolls to use the service the infrastructure provides, which, after deducting the minimal operating costs needed to keep a road open, forms the basis of a reliable return to private investors over many decades.

Third, and unlike the operation of a public transport system, the user fully bears the costs of providing and running a vehicle on the motorway.

Not surprisingly, cash-strapped governments have encouraged motorway investments in our cities and remained wary of new public transport investments. The latter depend heavily on public finance – and are also hideously expensive to run with low cost recovery from fare revenues.

For instance, after fare revenues, each of Sydney’s and Melbourne’s public transport systems still needs annual taxpayer injections of around A$5 billion to cover operating costs. Roads cost governments significantly less.

<h2>So what about City Deals?</h2>

In announcing City Deals as part of the <a href="https://theconversation.com/smart-cities-plan-offers-signs-of-hope-but-are-turnbull-and-taylor-just-dreamin-58628">Smart Cities Plan</a> last week, Prime Minister Malcolm Turnbull said that the days of the federal government acting as an ATM for the states’ infrastructure spending were over. This seems a most peculiar warning given the major role of the Commonwealth as a collector of taxes and their efficient deployment.

But if direct federal government spending on infrastructure is scaled back in favour of encouraging private finance into the void, then the rules of financing and funding infrastructure need to be obeyed.

The parameters are clear. Where there is risk – be it construction risk or revenue risk – then private finance will demand government pick up the tab for cost blowouts and revenue shortfalls. Then reliable funding streams must be created to feed competitive returns to the private capital investors. Funding can only come from two places: taxes or user fees.

Funding is the harsh discipline of private infrastructure investments. Public transport deals especially will be starved of private finance because in Australian cities commuters refuse to pay the full costs of their train, bus, ferry and tram rides. But without higher fares, or continued public sector fare subsidies, private sector finance won’t be attracted.

Private infrastructure investment is a complex process, especially in multi-billion-dollar projects. The detail matters and is different in every case. Yet last week’s announcement of City Deals as a solution to the nation’s failing urban infrastructure systems was, in the end, the launch of a brochure.

Perhaps an election campaign will tell us more.<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/58737/count.gif" width="1">

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/city-deals-still-no-more-than-a-pamphlet-after-budget-2016-58737">original article</a>.

Lead image credit: ABC.
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City Deals still no more than a pamphlet after Budget 2016

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By <a href="http://theconversation.com/profiles/carolyn-whitzman-9944">Carolyn Whitzman</a>, Professor of Urban Planning, <a href="http://theconversation.com/institutions/university-of-melbourne">University of Melbourne</a>. The co-author of this article is Brad Hosking, the corporate director of Common Equity Housing Limited.

Average house rents in metropolitan Melbourne have <a href="http://www.domain.com.au/news/renting-in-melbourne-median-house-apartment-price-soars-20160406-gnyyhv/">increased by 5.3%</a>, with apartment rents growing by 2.8%, over the last three months. A <a href="">lack of affordable rental properties</a> is a problem in Sydney too. This has fuelled speculation of a <a href="http://thenewdaily.com.au/money/2016/01/15/australia-rental-rates-apartment-glut/">housing bubble</a>, particularly in the wake of falling investor demand for new high-priced CBD apartments in these capital cities and others.

But beyond the headlines lies a difficult policy task for all three levels of government, in conjunction with the private sector and civil society. They need not only to create more affordable housing, but to keep it affordable in the long run.

Recent discussions with private developers and investors suggest there is growing willingness to collectively tackle the problem. However, some common misapprehensions remain about who needs affordable housing and how those needs might be met.

<h2>Looking beyond the stereotypes</h2>

There continues to be two quite different stereotypes about the people who need affordable housing:

<ul>
<li>First, there is the older single man with mental health and/or addiction issues, who may need therapeutic assistance and housing.</li>
	<li>Second, there is the “key worker” individual or couple – young, working in education, medicine or emergency services – who just simply need “more supply”.</li>
</ul>
The reality is that there are many different kinds of households requiring affordable housing. Many different mechanisms will need to come into play to meet their needs.

Penny the pensioner is living in poverty, like <a href="https://www.lmcf.org.au/images/2016-Time-of-Our-Lives-Report-LMCF.pdf">one in three</a> older women. She spent many years bringing up two children full-time and did not accumulate retirement savings or assets. As a very-low-income person, she receives <a href="https://www.humanservices.gov.au/customer/services/centrelink/rent-assistance">Commonwealth Rent Assistance</a>. However, she is among the 35,000 Victorians <a href="http://www.theage.com.au/victoria/victorias-public-housing-waiting-list-skyrockets-20151109-gkuao1">on the waiting list</a> for public housing.

Penny can no longer afford to live in or near Port Melbourne, her home for her entire life. This is because there are simply no rental apartments available there for A$165 per week, which is what she could afford.

Penny wonders if Australia’s largest urban redevelopment project next to Port Melbourne, <a href="http://www.mpa.vic.gov.au/wp-content/uploads/2015/03/Affordable-Housing-Options-Paper.pdf">Fishermans Bend</a>, could have an apartment for her sometime soon. But with no new Commonwealth affordable housing program in place, no inclusionary zoning or financial incentives at the state level, and rate capping at the local government level reducing capacity to invest in affordable housing, at most 1.3% of the total 40,000 projected housing units will be available to middle-income households – let alone low-income people like her.

Even if new units were developed in Fishermans Bend, a 50m² apartment would cost about $300,000 to build, given land, construction and financing costs. Rates, water, maintenance and management would cost about $9,000 a year per unit to deliver.

These costs could not be recovered fully through Penny’s rent, even if construction was completely subsidised. There would need to be a combination of lower-cost land, subsidised construction, guaranteed finance, rate relief and ongoing subsidy to make her living unit viable for the private sector to deliver and a community housing provider to own and manage.

Naresh is a nurse. He would be classified as a moderate-income earner. He lives with his wife Nadira. They recently had a child; Nadira is a full-time parent.

Because he is a shift worker, Naresh’s public transport options are not reliable. He would prefer to live within walking or cycling distance of his workplace, even in a smaller unit, as he does not own a car.

Naresh can afford to pay 30% of his $60,000 annual gross income on rent, which works out to $340 per week. This is still below the average rent in Melbourne for a 70m² two-bedroom unit.

A few two-bedroom apartments are available for that price – about an hour’s public transport ride away from his job. However, he works in a well-serviced but conservative inner suburb, where new apartments aren’t being constructed and existing flats are rented by much-higher-income households.

Naresh would have to add the cost of buying and maintaining a car to his rental cost and a long commute to an already difficult work-life balance. This is hardly affordable or family-friendly living.

Even if new apartments were being constructed where they are most needed, it would cost at least $400,000 to build and require about 50% construction subsidy for a community housing provider to be able to rent to Naresh and Nadira. The alternative would be short-term renting in the private market with the likelihood of having to relocate every year or two.

<h2>Signs of progress</h2>

Across Australia, there was <a href="https://www.ahuri.edu.au/__data/assets/pdf_file/0011/2081/AHURI_Final_Report_No241_Supply-shortages-and-affordability-outcomes-in-the-private-rental-sector-short-and-longer-term-trends.pdf">a shortage</a> of 122,000 affordable and available dwellings nationwide in 2011. This was a 40% increase from 87,000 in 2006. The problem has worsened since the last census in 2011.

There are some signs of progress across Australia. After a cross-party <a href="http://www.aph.gov.au/Parliamentary_Business/Committees/Senate/Economics/Affordable_housing_2013/Report">Senate inquiry into affordable housing</a> in 2015, the Affordable Housing Working Group is <a href="http://www.treasury.gov.au/ConsultationsandReviews/Consultations/2016/CFFR-Affordable-Housing-Working-Group">looking at</a> “innovative financial models” to scale up production.

Several states are taking concrete actions. Western Australia was the first cab off the rank and had attained its <a href="http://www.dhw.wa.gov.au/aboutus/affordablehousingstrategy/Pages/default.aspx">ten-year targets</a> by 2015. New South Wales has established the <a href="http://www.facs.nsw.gov.au/reforms/social-housing/SAHF">Social and Affordable Housing Fund</a>. Queensland’s <a href="https://www.getinvolved.qld.gov.au/gi/consultation/2851/view">Affordable Housing Strategy</a> is at the discussion stage.

In Victoria, the previous Coalition government’s strategic plan for metropolitan Melbourne is <a href="http://refresh.planmelbourne.vic.gov.au/">being “refreshed”</a>, including a greater emphasis on housing need. In advance of a promised affordable housing strategy, the current Labor government <a href="http://www.theage.com.au/victoria/victoria-pledges-half-a-billion-dollars-to-family-violence-services-20160413-go521s">recently announced</a> a $150 million “housing blitz” for women and child survivors of family violence.

Several local governments in Melbourne have also led the way in donating land to affordable housing, particularly the <a href="http://www.portphillip.vic.gov.au/www.foskbg.org.au/print_/In_Our_Backyard_-_draft_for_adoption_April_2016_V2_-_7_April_2015(1).pdf">City of Port Phillip</a>.

The trick is going to be combining various actions by Commonwealth, state and local government to support private developers and community housing providers in not only developing new housing, but keeping it affordable for hundreds of thousands of Australians.<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/57628/count.gif" width="1">

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/where-do-record-rental-prices-leave-low-income-earners-57628">original article</a>.
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Where do record rental prices leave low-income earners?

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<a href="http://theconversation.com/profiles/tony-matthews-234160">Tony Matthews</a>, <a href="http://theconversation.com/institutions/griffith-university">Griffith University</a> and <a href="http://theconversation.com/profiles/jason-byrne-6066">Jason Byrne</a>, <a href="http://theconversation.com/institutions/griffith-university">Griffith University</a>

Our cities are getting hotter, more crowded and noisier. Climate change is bringing <a href="https://theconversation.com/sydney-so-hot-right-now-whats-behind-the-citys-record-run-of-warm-weather-55756">more heatwaves</a>, placing <a href="https://theconversation.com/adapt-now-to-prevent-poor-health-from-climate-change-report-40958">pressure on human health</a>, urban amenity, productivity and <a href="https://theconversation.com/building-climate-resilience-in-cities-lessons-from-new-york-52363">infrastructure</a>.

Urban residents naturally want to stay cool. Air conditioning is the usual choice, but it can be expensive to run. Air conditioning also adds carbon pollution, creates noise and can make outdoor spaces hotter.

So what else can we do to manage increasing urban heat? And who has the ability to act?

Urban planners are increasingly involved in developing and delivering urban greening strategies. While it seems like a “no brainer” to green cities, <a href="http://www.sciencedirect.com/science/article/pii/S0169204615000419">our international research</a> shows that planners are not always comfortable with this idea.

However, <a href="https://www.asla.org/greeninfrastructure.aspx">green infrastructure</a> – including street trees, green roofs, vegetated surfaces and green walls – is emerging as a viable way to help cities adapt to increased heat. Uptake of these technologies is slowly increasing in many cities around the world.

<figure class="align-center "><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/114028/width754/image-20160307-30500-gr7yt.jpg"><figcaption>Green walls cooling a building in Singapore. Tony Matthews</figcaption></figure>The Australian government has recognised this trend. An <a href="http://www.environment.gov.au/minister/hunt/2016/mr20160212">agenda to green Australia’s cities</a> is now in place. Stated aims include managing climate change impacts, reducing urban heat, improving urban well-being and increasing environmental performance.

This urban greening agenda is part of the Clean Air and Urban Landscapes hub, under the <a href="http://www.environment.gov.au/system/files/pages/2f561690-b47e-4bf2-b028-d18739b3486f/files/nesp-research-priorities-2015.pdf">National Environmental Science Program</a>.

<h2>Benefits of urban greening</h2>

The broadening appeal of green infrastructure is helped by the fact it offers <a href="https://www.griffith.edu.au/__data/assets/pdf_file/0004/275107/urp-rp32-matthews-2011.pdf">multiple benefits</a>.

For example, shading from strategically placed street trees can lower surrounding temperatures by <a href="https://www.researchgate.net/publication/273764538_Residents%27_understanding_of_the_role_of_green_infrastructure_for_climate_change_adaptation_in_Hangzhou_China">up to 6℃, or up to 20℃ over roads</a>. Green roofs and walls can naturally cool buildings, substantially lowering demand for air conditioning. Green infrastructure can also provide habitat for wildlife, recreational opportunities for people, better management of stormwater runoff and improved urban aesthetics.

<figure class="align-center "><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/114029/width754/image-20160307-30476-eemx0t.jpg"><figcaption>Street trees and green walls helping to reduce urban temperatures. Tony Matthews</figcaption></figure>Hard surfacing, including concrete, asphalt and stone, is common in cities. It <a href="https://theconversation.com/explainer-why-are-cities-warmer-than-the-countryside-53160">can increase urban temperatures</a> by absorbing heat and radiating it back into the air. Green infrastructure can minimise this difficulty as it better regulates ambient air temperatures. Foliage allows local cooling through evapotranspiration, where plants release water vapour into the surrounding atmosphere.

<h2>Why planners are cautious</h2>

<a href="http://www.sciencedirect.com/science/article/pii/S0169204615000419">Our research</a> examined urban planners' attitudes towards green infrastructure use in Australia, England and Ireland. We found that planners are broadly aware of green infrastructure as an urban intervention. They understand its use, application and capacity to provide multiple benefits, especially in terms of managing urban heat.

The planners we interviewed, while recognising the potential value of green infrastructure, strongly cautioned that delivering the technology can be an uncertain process. The biggest barrier cited was that planning departments are not experienced with green infrastructure.

Put simply, they tend to avoid it because it has not traditionally featured on planning agendas. Like any new planning endeavour, green infrastructure can create institutional, legal, economic, social and environmental challenges.

Some of the biophysical challenges associated with green infrastructure delivery are novel. Choosing appropriate forms of vegetation, for example, may be difficult. Decisions must be made based on prevailing climactic conditions, drainage capacity and species growth patterns.

Will root systems damage buildings or underground utility networks? Might trees topple during storms and damage houses? Are roofs strong enough to support a rooftop garden? Planners may not be able to answer these questions, which creates a need for external experts to advise them.

Our findings also highlight socio-political factors as barriers. These include governance concerns such as the political context in which planning decisions are made.

Management issues also feature. Chief among these are government commitments to budget for green infrastructure delivery and management.

Planners are also wary of public involvement. They know that public sentiment about green infrastructure can be influenced by perceptions of modified access, changed use, or loss.

<h2>What can be done?</h2>

The urgency for providing urban green infrastructure increases as climate change makes our cities hotter. Our research suggests the principal task for planners is to overcome embedded practices and to accept green infrastructure as an emerging but permanent urban feature.

This will not be easy. For example, a decision to use a road easement for green infrastructure may require multiple meetings with other government departments, utility companies and residents. Planners will need to coordinate these, manage stakeholder expectations and ensure cost sharing where necessary.

Legal, economic, social and environmental issues will require innovative solutions.

Planners will increasingly be tasked to deliver green infrastructure in cities. They will need to be clear on its value, be prepared to lead its delivery and learn from new challenges and solutions encountered along the way.

Urban residents all over the world stand to benefit if planners can successfully meet this challenge, particularly as hotter temperatures threaten urban comfort and habitability.

<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/55753/count.gif" width="1">

<a href="http://theconversation.com/profiles/tony-matthews-234160">Tony Matthews</a>, Lecturer in Urban &amp; Environmental Planning, <a href="http://theconversation.com/institutions/griffith-university">Griffith University</a> and <a href="http://theconversation.com/profiles/jason-byrne-6066">Jason Byrne</a>, Associate Professor - Environmental Planning, <a href="http://theconversation.com/institutions/griffith-university">Griffith University</a>

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/if-planners-understand-its-cool-to-green-cities-whats-stopping-them-55753">original article</a>.

Lead image credit: <a href="https://www.flickr.com/photos/jlascar/11884387654/">flickr</a>
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If planners understand it's cool to green cities, what's stopping them?

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By <a href="http://theconversation.com/profiles/kim-dovey-107660">Kim Dovey</a>, Professor of Architecture and Urban Design, <a href="http://theconversation.com/institutions/university-of-melbourne">University of Melbourne</a>.

With debate raging over who wins and who loses with proposed <a href="https://theconversation.com/sacred-cow-no-more-what-proposed-changes-to-negative-gearing-really-mean-54737">major changes to negative gearing</a>, attention also falls on which Australian suburbs are most likely to suffer.

The Australian Financial Review recently discussed the “<a href="http://www.afr.com/news/economy/top-10-suburbs-set-to-suffer-under-negative-gearing-plan-20160216-gmv5m1#http://www.afr.com/news/economy/top-10-suburbs-set-to-suffer-under-negative-gearing-plan-20160216-gmv5m1">Top 10 suburbs set to suffer under negative gearing plan</a>”. The Australian <a href="http://www.theaustralian.com.au/national-affairs/treasury/labors-negative-gearing-plans-could-hit-nearly-400-suburbs/news-story/8a78d5a30fd8291cb851174bbe2b31b3">soon joined</a> this scare campaign. Mandurah in Western Australia, where I spent a recent weekend, is on the AFR’s list.

When I grew up this was a lazy holiday town at the entry to an inlet. It’s now one of Australia’s fastest-growing suburbs with a 50-minute train connection to central Perth. Within walking distance of the town centre is a cluster of relatively recent medium-density mixed-use developments on or near the waterfront. The dolphins and crabs are prolific and opportunities for swimming, boating and kayaking are at everyone’s doorstep.

Unlike most outer suburban developments, the housing is relatively dense – mostly about four to five storeys high, with a couple of blocks up to ten storeys. This is a highly walkable neighbourhood with generous public space. Shops and cafes line much of the ground floor.

<h2>Built density but lacking intensity</h2>

This is not far from the kind of urban development we need a lot more of in Australian cities – places that encourage people to walk to work, shopping and recreation; where densities are high enough to support a good range of shopping and public transport.

The main problem here is that while the built density is relatively high, the population density is less than your average suburb.

The AFR article suggests this is the kind of place that is “set to suffer”, yet these parts of Mandurah already suffer from an occupancy rate that locals estimate at 20%. The empty housing has <a href="http://www.perthnow.com.au/business/mandurah-city-of-broken-dreams/story-e6frg2ru-1226381291918">had a spillover effect</a> into empty shops and offices, empty streets and parks, and poor public transport.

The public space is bereft of vitality (and the safety that comes with it); beaches, parks and walkways are largely empty even on a warm February weekend. While there is lots of built density, there is little intensity of public life. The streets are lined with empty shops used as billboards for real estate and financial services.

<figure class="align-center zoomable"><a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/113832/area14mp/image-20160304-20111-v38nz3.jpg"><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/113832/width668/image-20160304-20111-v38nz3.jpg"></a>

<figcaption>Beneath empty housing and balconies, the streets are lined with empty shops are used as billboards for real estate. Kim Dovey, Author provided</figcaption></figure>While much of this is holiday housing, it is within commuting distance of a major city. How much of it is going to waste simply because those who own it can profit from making a loss under the current negative-gearing rules?

<h2>Bringing empty housing onto the market</h2>

While curbing negative gearing would ease house prices in the short term, in the longer term suburbs like this are set to benefit because it will surely bring much of this empty housing onto the market. Then the synergies of higher-density mixed-use development within reach of good public transport will begin to come into play.

As more residents live within walking distance, more amenities will become viable. The more people walk or cycle, the better the health and transport outcomes.

Ultimately, this is the kind of vibrant walkable city we need to build more of to achieve serious reductions in CO2 emissions – places where we can live great and healthy lives with less reliance on cars.

<figure class="align-right zoomable"><a href="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/113835/area14mp/image-20160304-20137-po46k8.jpg"><img alt="" src="https://62e528761d0685343e1c-f3d1b99a743ffa4142d9d7f1978d9686.ssl.cf2.rackcdn.com/files/113835/width237/image-20160304-20137-po46k8.jpg"></a>

<figcaption>Despite the allure of its waterfront, Mandurah’s public spaces are strangely bereft of people and activity. Kim Dovey, Author provided</figcaption></figure>It is impossible to say how much this production of empty architecture is a function of negative gearing since it also goes hand-in-hand with neoliberal markets and high disparities of wealth. However, the curbing of negative gearing will have a significant impact in getting empty housing onto the market.

This in turn could go some way to reversing this cycle of emptiness – bringing life to the shops, offices, streets, parks and public transport.

<h2>‘Positive gearing’ across Australia</h2>

This is not just a benefit to places like inner Mandurah. It also applies to other empty suburbs and even high-density inner-city neighbourhoods. <a href="https://www.propertyobserver.com.au/http://www.abc.net.au/news/2015-02-09/melbourne-develops-the-city-centre-with-dire-consequences/6080146">Southbank</a> and <a href="http://www.news.com.au/finance/real-estate/melbourne-vic/foreign-buyers-behind-melbournes-hidden-housing-vacancies/news-story/26490dfcf186b70c017b23e85346dd47">Docklands</a> in Melbourne come to mind as places that produce largely empty buildings – density without intensity.

Negative gearing produces an underutilisation of urban space. The imperative to curb it has important implications for the future of Australian cities.

And this raises a further question – why stop there? If we are looking for new tax revenues that will help to balance the budget, curb CO2 emissions and increase the productivity and vitality of cities, then why not tax the underuse of urban space? Perhaps we could call it “positive gearing”.<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/55750/count.gif" width="1">

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/how-negative-gearing-changes-can-bring-life-back-to-eerily-quiet-suburbs-55750">original article</a>.

Lead image credit: <a href="https://www.flickr.com/photos/mugley/2191518199/in/photolist-4kE71x-5Z3mf-54kNJv-L9jt-fowhDJ-qy4FkM-7S4pzZ-7j4JVd-7iZRMR-4eBLEe-7iZRRT-rdgRMm-569CjL-jWwqB-5QGCiu-beNPri-E7Bwm-kLrbMR-5BzVz1-tgwo1-9EMhh7-8KV5Un-7TRyzX-e1H3Kg-989TNd-7BzSKH-7uh4cr-E7BzL-9wCXa-7ukX1E-7TRwN6-e1NG5h-e1NDSL-986JQx-e1H1D6-oWAKne-pKEJso-5y4Uti-pKEZgb-9MxXjS-atPEV8-iMG3pY-atSm6C-5CqRch-4yXQpV-7VLJRr-sgS7AL-21J5H-brKLFZ-5BvNqe">flickr</a>
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How negative-gearing changes can bring life back to eerily quiet suburbs

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<a href="http://theconversation.com/profiles/jago-dodson-2359">Jago Dodson</a>, <a href="http://theconversation.com/institutions/rmit-university">RMIT University</a>

The Australian tax debate has placed negative gearing <a href="https://theconversation.com/sacred-cow-no-more-what-proposed-changes-to-negative-gearing-really-mean-54737">under scrutiny</a>. Most of the debate lurches between retentionists, who back negative gearing as a necessary subsidy to <a href="https://theconversation.com/housing-bubble-or-not-negative-gearing-should-stay-32014">support affordable housing</a>, versus abolitionists, who see it as a market-distorting extravagance that delivers an <a href="https://theconversation.com/three-myths-on-negative-gearing-the-housing-industry-wants-you-to-believe-54732">unfair advantage to the wealthy</a>.

But what if there was a middle option between retention and abolition that made it work better?

Negative gearing allows investors to claim a tax concession against their personal income for losses incurred on a rental investment property. It is estimated to be worth around <a href="http://www.smh.com.au/federal-politics/political-news/cut-negative-gearing-trim-capital-gains-tax-concession-and-save-9-billion-parliamentary-budget-office-says-20150804-girj31">A$8 billion a year in tax concessions</a>.

There is a somewhat obscure technical argument in favour of negative gearing for equalising concessions for property investment losses with similar concessions for other investment classes. But most participants in the debate about negative gearing treat it as a subsidy for investment in housing supply.

The abolitionist argument hinges on two main issues. First, it distorts investment by encouraging deliberate loss-making in property investment. Second, as a form of subsidy, it adds inflationary pressure to housing markets that favour already wealthy investors over home buyers. And the federal government pays for it in tax revenue forgone.

Retentionists, however, argue that abolishing negative gearing would lead to an adverse supply shock in the rental housing sector. That would result in housing shortages, higher rents, and worsening affordability for low-income households.

Labor has taken a moderate abolitionist stance. It proposes to <a href="https://theconversation.com/shorten-policy-hits-tax-breaks-for-negative-gearing-and-capital-gains-54700">restrict negative gearing to new housing</a>, though with the concession continuing for loss-making landlords who already receive it.

The Coalition government has not yet stated its position on negative gearing. However, there appears to be a strong retentionist stream within government policy statements. The government is also being assailed by property sector lobby groups advocating retention.

<h2>We’re flying blind on policy reform</h2>

There may be another perspective that sits between abolition and retention. A sensible reformist view might be encouraged by the federal government’s preparedness to, in effect, subsidise private market housing by $8 billion per year.

But such a view might also lament the extraordinarily ineffective targeting, outrageously poor transparency about who receives the subsidy, and egregious lack of accountability for supply outcomes.

These concerns emphasise the gross information gaps about the landlords who receive the subsidy and the rental houses that incur the concession. We generally know which landlords receive negative gearing, their occupational status and their income levels. We don’t which properties in the rental market are negatively geared, nor the social status of their tenants.

Thus there is no transparent connection between the landlords receiving the subsidy, the dwellings that are negatively geared and the status of the tenants who live in them. This means there is no direct empirical way to verify whether negative gearing benefits low-income tenants.

The federal government seems willing to forgo $8 billion in tax revenue to subsidise rental housing supply. Surely, then, it ought to ensure this concession assists the neediest tenants in the most pressured parts of the housing market and make landlords transparently accountable for this.

Labor’s partial abolition proposal takes a minimal step towards transparency by limiting negative gearing to new properties.

<h2>Let’s talk about the alternatives</h2>

A reformist approach would seek better value for the government’s A$8 billion-a-year investment, in terms of improved affordability for tenant households. How might this work?

The key requirements would be to ensure transparency about which dwellings are negatively geared and the socioeconomic status of their tenants. There are various ways to achieve this.

One model would be to tie the negative gearing subsidy to specified tenant groups. In this case, only if landlords let properties to target tenants, such as those on Newstart, sole parent or aged pension, would they receive the subsidy. This could be done by requiring tenant social security numbers to be reported with landlord tax returns to enable verification.

This approach could be extended by capping the value of weekly rents on properties to which negative gearing could apply. Locational targeting could focus the subsidy to areas with high market rents and poor affordability.

The transition to such a model could be phased in by starting with minimal transparency and accountability requirements and ramping up to more specific requirements. Additional compliance costs would raise the cost of investing in housing. But, it would weed out the investors who are seeking pure profit and encourage those with a social perspective.

A second model that extends transparency and accountability could involve converting negative gearing to a formal low-income housing tax credit <a href="https://theconversation.com/americas-rental-affordability-crisis-is-about-to-go-from-bad-to-worse-48143">as operates in the US</a>. Such a model provides a tax credit for investors in affordable housing that is certified as managed by a legitimate social housing provider. This could be the fillip that Australia’s small community and non-profit social housing sector needs.

A third model might be to channel negative gearing to a dedicated financial investment vehicle drawing on private investment for affordable housing that is built for or let to low-income tenants. There has been a long-standing debate in Australian housing policy circles about the need for long-term institutional investment in <a href="http://www.ahuri.edu.au/publications/download/ahuri_30652_fr">affordable housing</a>.

A finance vehicle that offered a return on capital to investors supported by a tax concession could underpin new affordable housing supply. Other countries have used housing bonds in this way to attract additional investment in affordable housing.

Another model could use a reverse auction approach, with landlords competing to supply housing of certain specifications to tenants of a particular income category in return for set levels of tax credit. This would operate in a similar way to the government’s carbon abatement plan, which involves a <a href="https://theconversation.com/explainer-how-does-todays-direct-action-reverse-auction-work-40152">reverse auction for renewable energy projects</a>. Though this might raise transaction costs, it might encourage helpful institutional consolidation in the private rental sector.

A fifth approach might be for the government to provide the A$8 billion as vouchers to low-income tenants for use in renting housing of a set standard or location. Landlords would then cash these vouchers in as tax concessions. The US operates a subsidy model of this type known as “<a href="http://portal.hud.gov/hudportal/HUD?src=/topics/housing_choice_voucher_program_section_8">Section 8</a>”.

A final option would be to simply take the $8 billion-a-year subsidy represented by negative gearing and build desperately needed public housing. Such an approach guarantees transparency and accountability and could directly build around 20,000 dwellings a year, or more with leveraged private finance.

No doubt the current subsidy could be remixed in multiple other ways to improve effectiveness, transparency and accountability in how it procures affordable housing. The examples offered above show that we could be having a much more positive debate about negative gearing than just abolition or retention.

<img alt="The Conversation" height="1" src="https://counter.theconversation.edu.au/content/55293/count.gif" width="1">

<a href="http://theconversation.com/profiles/jago-dodson-2359">Jago Dodson</a>, Professor of Urban Policy and Director, Centre for Urban Research, <a href="http://theconversation.com/institutions/rmit-university">RMIT University</a>

This article was originally published on <a href="http://theconversation.com">The Conversation</a>. Read the <a href="https://theconversation.com/scrap-or-preserve-negative-gearing-heres-six-other-options-worth-debating-55293">original article</a>.

Lead image credit: <a href="https://urban.melbourne/forum/cbd-eq-tower-127-abeckett-st-63l-202m-residential?page=6#comment-20577">Ryan Seychell</a>
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