We all want a village “feel” to our city and we like green, leafy suburbs. We want our family to live close by. We want housing to be affordable. We say so at every planning event. What we actually get is expensive, boring, concrete cubes for homes, shops and offices. Our families live in the outer suburbs. We feel constricted. Commuting is slower every month. Where do we go wrong?
Land, especially near city centres, has become very expensive. This rise in land prices is not because land is scarce in Australia; it’s just scarce in the places where we need it. Our low-rise homes and offices lock up the surface and the air space above them. The price of land has become a silent, non-productive tax on living and on doing business.
Building height and density restrictions deter growth in knowledge industries. Across the world we see that innovation thrives on the exchange of ideas when people live and work in well planned cities where people are close together. Lots of research shows a link between our skills base and the tendency to create new kinds of work. New job categories appear where there are more highly skilled workers. There is ample statistical evidence to show a link between population and productivity. Workers build knowledge faster in cities with lots of idea industries. People clustered together boost each other’s employment opportunities and potential income. We need more of this in WA to take us beyond mining.
It’s easy to see why we began imposing building restrictions. The crowded slums of the last two centuries showed how crime, disease, polluted air and filthy water reduced our quality of life. Such regulations expanded, bringing unintended consequences that limited our potential. We saw the shoulder to shoulder towers of New York and the featureless towers of the Gold Coast and didn’t like what we saw. What we got was short, squat office blocks and neighbourhoods without amenity; just heaps of plain offices here and houses without community there.
Looking to the future, if limits on height and density were relaxed less land would be needed to satisfy accommodation and commercial demand. This would take pressure off prices, meaning that we could allow more land for public space and our families could afford to buy a home. The greatest effect would be felt by those on low to middle income, whether they were buying or renting their homes. Thomas Piketty showed in “Capital in the Twenty-First Century” that house prices contribute to rising inequality.
The greatest effect of relaxing laws would be on boosting the whole economy. As worker productivity increases, the whole community benefits. This extends even to those not living in the effected near-city areas. At present many workers take jobs in lower-paying areas just because they can’t afford to live where the good work is located. Stamp Duty on house sales acts as a further disincentive to move to more productive locations. Labour allocates itself to low-productivity markets and the whole economy suffers.
Defining the problem is easy. Getting individual Councils to change planning schemes is the difficult bit. The results would benefit everybody. Rich land owners with a narrow self-interest are likely to be the chief opponents. Since the State Government would benefit by larger tax revenues from a growing economy they could move to compensate the affected nearby landowners on a reducing scale over a few years.
This is a big picture view for a better future. We can extend this theme to better transport, a cleaner environment and a stronger community. What are your thoughts?
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