Business Council of Australia pushes for overhaul of land zoning and planning rules to ease housing crisis

There are growing calls to rezone land for higher-density housing in a bid to help more people find homes in cities where they work and want to live.

The Business Council of Australia wants to work with State governments on an overhaul of land zoning and planning rules in what it sees as an answer to the housing crisis.

It wants extensive rezoning across major cities and towns, home builders to be able to propose zoning changes that boost housing supply, and simpler land use categories across the board.

“We need State and Territory governments to unlock more land for more homes in cities and towns across Australia so we can fix this supply crisis,” BCA chief executive Bran Black said.

“Put simply, we need to build enough homes where people want to live, so until we fix that problem, it will be very hard to hit our housing targets — building a home in the right place is as important as building it at all.”

Mr Black applauded the WA Government’s moves to embark on major reports to the planning system, cut red tape and boost supply but said still more should be done.

“We welcome the standardised zoning approach across the state because we know that’s a clear way to build more homes,” he said.

“We also think the Federal Government should provide more funding to WA to support housing reforms, in the form of a National Reform Fund.”

Work done for the Business Council’s report, It’s time to say yes to housing, found rezoning residential land in Auckland in 2016 led to a significant jump in housing approvals and construction.

It also meant houses could be built for less where multiple dwellings were constructed on the same piece of land, and rents were cheaper.

The BCA has already called for State governments to have powers to take planning authority away from councils that didn’t approve new homes fast enough.

Master Builders Australia’s industry policy director Alex Waldren said on Wednesday the barriers constraining the ability to build more houses had to be reformed to address the desperate need to boost supply.

“Ongoing supply and affordability challenges are limiting housing tenure options and pushing more Australians into rental dwellings and social housing, as we know, and this is unsustainable,” she said.

The Federal Government has a target of building 1.2 million homes over the next five years, but so far construction and approvals are falling well short of what’s needed.

About 176,000 homes were built over the 2023-24 financial year — there needs to be an average of 240,000 built every year to hit the target.

Approvals for new homes are also falling short, suggesting the pipeline of new construction won’t pick up as needed.

Shadow housing minister Michael Sukkar said this meant the Government’s promise “had already failed”.

Treasurer Jim Chalmers said on Wednesday, amid scrutiny over Prime Minister Anthony Albanese’s personal property dealings, that the Government’s highest priority was easing the cost of living and its housing agenda was a major part of that.

“Too many people are sleeping rough. Too few people can find an affordable place to rent or buy. It is becoming too hard for young people, in particular, to get a toehold in the housing market,” he said.

“These are the motivations behind the $32 billion that we have invested through three budgets in building more homes to make it easier for more Australians to find a place to rent or find a place to buy.”