Between floods, fires and pandemics the value of land in the Northern Rivers has shot up and many people were appalled at the base increase of land determined by the Valuer Generals valuations that came through last year. For many in the region living in vans, on couches or straight out moving away has become the only option as the price of land and housing has increased in the region.
At the recent Lismore City Council (LCC) meeting former Mayor Vanessa Ekins and councillor Elly Bird moved the motion to introduce an Affordable Housing Contribution Scheme (AHCS) and submit it to the state government for a gateway determination.
‘Under my leadership as Mayor, Lismore City Council declared a housing emergency. The situation was critical even before the 2022 floods,’ Cr Ekins told The Echo.
‘Council prepared an Affordable Housing Strategy (AHS) that identified all the residential land we had planned for, nearly 4,000 housing lots which were not being developed or released to the market. The reasons for this include infrastructure costs, the slow State Government planning process and landbbanking.’
Farmland to residential
The proposed AHCS seeks to take a percentage of the profit from developers when they rezone land from farmland to residential land. It is when this takes place that there is significant profit made and it is one of the few opportunities councils have to reap a financial benefit from the process.
Affordable housing
‘At the March LCC meeting, councillors endorsed an AHCS where farmland that is upzoned to residential land will make a small contribution of their profits to council for the building of affordable housing,’ explained Cr Ekins.
‘For example, a farm that is worth say $3 million, after rezoning to residential, would be worth $30 million. When a viable development is proposed on this land, and the developer has a profit of 22 per cent, only then will a small percentage be available to Council to build affordable housing.
‘Housing has been at emergency levels in the Lismore local government area (LGA) since before the flood. The AHS found that 80 per cent of houses [in the Lismore LGA] had three or four bedrooms but 65 per cent of homes were lived in by one or two people. So smaller, more affordable homes are necessary and the market is not providing them.’
Farmers have it hard
Not all councillors agreed with the principle proposed and Cr Jeri Hall told the meeting that farmers have worked hard for their land experiencing floods and fires etc.
‘It is not a farmers responsibility to provide affrodable housing for Lismore. It is something the state government needs to do,’ she told the meeting.
However, as Cr Ekins pointed out it is not usually the farmers who reap the significant benefits of teh upzoning of their farmland to residential as ‘usually the farmer sells to developer’ who then realises the significant gain from the rezoning.
Viability
Cr Bird, who seconded the motion, took the time to ensure the gallery, and other councillors, were clear on the mechanism that would be employed to calculate the ten or seven per cent that council would receive under the AHCS.
‘The developer undertakes their homework,’ said council staff.
‘The methodology around the feasibility of land being brought to market is based on the internal rate of return and the profit margin the developer enjoys when that land comes to market. The percentages in terms of affordable housing that were originally proposed were significantly higher than thet ones that have been brought to council. The feasibility study suggested much more than that, we are taking a reasonably conservative approach. It is a pretty comprehensive exercise that staff and consultants have gone through to come up with this process.’
Key worker accommodation
The affordable housing resulting from the AHCS would be available for key workers from health care workers and teachers to the people who work at the gyms, cafes and cut your hair.
‘We have an opportunity to provide this flood-free key worker accommodation in Lismore that will service the whole region, with masterplanned medium-density housing that includes commercial spaces and community facilities. Affordable housing benefits our entire community,’ said Cr Ekins.
‘Affordable housing. What a hard nut to crack,’ said Cr Bird.
‘Why this scheme is so important is that it is not a matter for local government alone. All levers and mechanisms by all levels of government need to be put into play. We in this chamber have looked at many ways to provide affordable housing and we need a range of housing for people to live here.
‘We have this lever to pull, and we don’t have many. This will help us to realise more diverse housing in our community and it meets multiple council housing and land strategies.
‘We have an opportunity to be part of trying to find a solution of a very wicked problem. With the AHCS we are seeking a very minor contribution and the benefits and offsets are significant for our community in the long term.
‘It is flood-free land rather than creating situations where people can only afford property in the floodplain that is under very high risk as we well know it this chamber. It is not a ‘must’ it is a ‘may’ [developer contribution]. If we don’t do this, at this point in time when we are rezoning significant parcels of land, we potentially miss the opportunity to allocate a small portion of those developments to affordable housing.’
Motion passed on Mayors casting vote
The vote was four all with Crs Colby, Bird, Ekins, and Krieg in favour and Crs Hall, Rob, Jensen, and Bing against.
The motion was carried with the casting vote of the Mayor.
‘As a Council we have done what we can in the provision of affordable housing, identifying the issues, planning for land release, working with LandCom to build affordable housing on Council land, and now the Affordable Housing Contribution Scheme which will go to the state government for endorsement and the community for comment before coming back to Council for adoption,’ said Cr Ekins.
‘If you think affordable housing is important and that developers should contribute a small proportion of their profits from converting farmland to houses, please keep the pressure on Council.’
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