Can Aussies even afford to live in apartments?

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The Minns NSW Government last month approved massive shoebox apartment complexes all over Sydney, overriding local environmental plans.

Sacrifices must be made to accommodate Mad Albo’s ‘Giant Australia’ mass immigration.

The Hills Shire mayor, Peter Gangemi, described the policy as a “free for all” for developers and “a Trojan horse for more shoebox-size apartments in suburbs that can barely cope”.

“[It] has the potential to trash our suburbs”.

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“Our roads are congested. Our schools are overcrowded. Our sporting fields are under pressure”, Gangemi told The SMH.

Waverley mayor, Paula Masselos, likewise claimed developers are “laughing, because they will have had significant windfall benefits as a result of putting in a few affordable housing units for a short period of time”.

“You’re also cramming a whole lot more people in at the detriment to public amenity”.

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The most disturbing aspect of the above is that we are only a few years removed from Sydney’s ‘crisis’ of combustible and defective apartments, which has also afflicted Melbourne.

According to a Strata Community Association NSW study published in October 2021, nearly four out of every 10 new apartment complexes in NSW contained major flaws.

To add further insult to injury, The ABC reported that Australian apartment owners are seeing their strata fees rocket, adding thousands of dollars in costs.

“Home owners from across the country told the ABC they have received alarming strata bills over the past year”.

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“Of almost 11 million Australian homes, 29% are either apartments or townhouses. There are almost three million properties around the country covered by a strata scheme”.

“If it keeps increasing at this level I won’t be able to sustain it”, one owner said.

“I’ll probably have to sell the place”.

Strata expert Michael Teys blamed growing strata rates on increased electricity and water prices, building and maintenance work, and skyrocketing insurance costs.

“Insurance premiums have increased somewhere between 10% and 60% because of a range of factors, mainly due to the climate, but also due to building defect claims”, he said.

Teys said he had heard reports of strata increases of up to 40%.

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“I think the very high increases that we’re seeing is partly to do with the fact that developers have a tendency to downplay the cost of levies when they’re selling the block”, he said.

Let’s be real for a moment. These high-rise shoebox apartments would not be necessary if the federal government did not choose to grow the nation’s population like a cancer cell through extreme levels of immigration.

This century, Sydney’s population has grown by over 1.2 million people, nearly entirely due to net overseas migration. Melbourne’s population has grown by 1.5 million people.

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The federal budget also estimated that NSW would add 578,000 people over the five years to 2026-27, whereas Victoria will add a whopping 694,000, both almost entirely through net overseas migration:

Population by state

Source: 2023 federal budget

Assuming historical settlement patterns persist, Greater Sydney will receive 70% of NSW’s anticipated population increase, amounting to around 405,000 people.

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Melbourne’s population will grow by around 500,000 if historical settlement patterns persist.

Australia needs a productivity-driven economy that shares the gains. Not a dumb population-based one that destroys the Australian way of life.

Sadly, our federal and state political elites have given up on governing for the benefit of the Australian people.

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About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.