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In my role as a handyman, I’m often maintaining the properties of landlords who aren’t maximising the potential of their land. This pains me, as I understand that there’s a housing shortage going on that is driving more and more people into homelessness. Large family homes of atleast three bedrooms often have just one or zero occupants. There are three such properties within a 2km radius of my home in the Blue Mountains that have not shown any sign of occupation for years. This is replicated in the commercial real estate market where a dozen shopfronts in the town of Springwood are vacant. What market conditions enable this?
Land banking is a phenomenon where owners don't bother doing anything with their land because having tenants could jeopardise the resale value of the property. It's clear that ongoing costs of owning a property outright, such as local council fees, are not enough to incentivise land usage. I spoke to a builder in the town of Glenbrook whose family owned prime vacant real estate for over thirty years and have only recently submitted an exciting development proposal, potentially because they saw my letter to the editor of the local newspaper decrying that location’s vacancy.
There is a government scheme called MyAgedCare that prefers to keep old people in their homes instead of in nursing homes. These "home care packages" are partially paid for by recipients and partly paid for by taxpayers depending on an asset test - if you’re a full pensioner, you get full taxpayer funding for property maintenance. This scheme reduces housing stock for young families and inevitably leaves multiple bedrooms vacant. If improperly administered, homes can fall into ruin, requiring much economic investment for new owners to renovate or rebuild on the site once ownership is exchanged.
Rent controls have tightened in my locality thanks to State MP Trish Doyle. It is common understanding amongst economists that rent controls can destroy cities, as landlords won’t want to invest in property if they can't do what they wish with it and can be reluctant to maintain it. Government policies such as Doyles inherently don't trust people and their right to freedom of exchange, where deals should be brokered between landlords and tenants without third party interference. Other policies like stamp duty taxation mean that people are disincentivised from downsizing or moving into a more efficient allocation of space. Therefore we have a situation where old people are often living in mould infested homes that once had children laughing and playing, who have now had to flee to areas with cheaper housing, creating physical distance between family members and causing great brain drain, particularly in conservative communities like the Blue Mountains that is reluctant to allow high density building developments.
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