Wednesday, 4 February 2026

 Richard RIORDAN (Polwarth) (10:30): I too wish to speak this morning on the Supply of Homes in Regional Victoria report, which the member for Monbulk contributed on, but I probably have a slightly different view to the member for Monbulk on the issues surrounding the supply of homes in regional Victoria. There is no doubt there is a housing crisis in regional Victoria, and the seat of Polwarth is no exception. We have a housing supply shortage along our coastal fringe, where land prices are very expensive and hilly bushland along the Otway Ranges makes it difficult to develop new homes. We then have the inland towns – Winchelsea, Colac and others – which should be providing a fantastic opportunity for families to live, work and play. The centre of Polwarth is well connected with rail services; nonetheless they are overcrowded, run poorly and the stations are falling down. Apart from that, there is potential there for a future Liberal government to actually improve public transport to the regions.

However, the point is the land is just not being developed at a price that people can afford. It is quite insane in this day and age that the cheapest parcel of land that will come to market in my electorate is around $192,000. That is for a very small parcel of land coming on the market soon. You can still get house and land packages for just under $600,000. That is a huge increase. The question this government has not answered on the supply of homes in regional Victoria is: why is there such a large embedded cost in the land? Land in regional Victoria is not subject to large multinational companies bidding tens of thousands of dollars against each other for high sales growth corridors. They are actually parcels of land that have often been owned by individuals for a long time, and they can come to market much more affordably. That is the competitive advantage that regional Victoria should have. Why isn’t that happening? It is not happening because windfall gains tax now exists. Windfall gains tax is basically almost doubling the price to market of a parcel of land because, unlike in fast-growing metropolitan areas, a relatively small hundred-block subdivision in a rural and regional town could take a decade or more to sell just on volume. That is a huge holding cost. That cost is being borne by the developer. That adds to the cost of the home.

We have got the situation where many of our country towns have not had major infrastructure upgrades, such as power, such as sewerage, such as water. All these services need to be expanded. Those costs are being directly borne by those new home owners. Our once progressive water authorities and power agencies which once actually used electricity, water and other services to grow and expand communities no longer have that as their impetus for being, so they are not being proactive. That is missing.

This report does not identify the way that the government can work more proactively with the private sector to unleash land. We have, for example, many recommendations here on how we can have more inclusive zoning and how we can have more social and public housing. They are all good aspects. The government can continue to do that. The reality is in rural and regional Victoria more than 60 per cent of people still want to own and live in their own home. That is an aspiration we should be encouraging. We should be working very closely with people to ensure it happens. The only way that happens is by bringing the average cost of a home back into a bracket that average families can afford to buy. Recent KPMG reporting makes it very clear that the mean for the whole state sees the average affordability for a young family at around $800,000. That is the average. Out in rural and regional Victoria that is considerably less and probably much closer to the $600,000 mark. That is at the top end of what it costs to bring a house to market in rural and regional areas, and it should not cost that much.

I also want to quickly touch on the fallacy of the Airbnb tax. Much is made by many in this chamber from time to time that an Airbnb tax is somehow going to make homes more affordable. It is simply not. In my electorate, where the whole coastline is dominated by people who own a second residence, they are in most cases never going to bring that property to market for long-term rental. It is a family asset, one that they use for holidays and for short-term rentals, and it is never going to be the same. The government knows that and is cheekily using that trait of property owners to increase taxes and add costs. What it has failed to do is work with local communities about where you can put and build affordable homes that people who live and work in coastal communities can actually move into. The focus has been on taxing the rich and not working with those who actually need a home in a place that they can afford and one that is achievable. This report has fallen well short of the mark.