People become amazingly confused when they hear the dreaded words: ESD
What does it really mean? Environmentally Sustainable Development.
This is nothing to do with climate change although, in my opinion, actioning most of these points contributes significantly to reduce the impact of climate change.
Some large strides have been made since the dreaded days of the 1970s:
- New projects require ESD statements and calculations and these pro formers are becoming tighter
- Harvesting of rainwater reducing public pipes and development pipes
- Significantly heavier insulation
- Double glazing
- Thorough consideration of orientation
- Better connection of private indoor and outdoor spaces
On the other hand other things have slid backwards:
- Recycling seems to be totally disorganised
Where to from here?
- Plant more trees and foliage
- Use more public transport
- Use electric vehicles
- Produce vegetables and fruit from our private gardens
- Generate more electricity in our homes, townhouses and apartments
Buildings
- More insulation
- Sealing gaps
- Using electricity generated by recyclables such as solar, wind, and hydro
- Geothermal heating and cooling
- Eliminating airborne pollutants from various chemicals
- Harvesting more rainwater
- Treating sewerage more locally
Town Planning Changes
WARNING: this is dry!
Way back in mid-2018 the Victorian State government made a number of planning changes called Amendment VC148.
It seems as though their main thrust is to simplify, and reduce the number of applications through common sense. Also being able to fast track small projects is easier.
What does this mean in review in a practical sense?
- Reduce car parking requirements for new uses of many existing buildings in commercial areas
- No visitor parking within 400 m of public transport (PPTN)
- No permit to reduce the required number of car parking spaces for a new use in an existing building, providing certain requirements are met
- Reduced car parking within 400 m of PPTN resulting in significantly fewer car parking numbers
- Integration of VICSmart (fast tracking) into relevant zones
- Heritage overlays more transparent and easier to discover
- Applications for land adjacent to a Road Zone are now exempt from notices and reviews.
For us this means fewer car parks on site which could even improve yield! Also more fast tracking of smaller projects.
What is going to happen with dwellings in 2020?
The current situation
“Borrowing costs were not going to rise anytime soon” source HSBC chief economist says in mid-2019 and the Reserve Bank governor repeatedly saying that interest rates are going to stay lower for a considerable period of time.
Meanwhile dwelling values in Sydney and Melbourne finished the year up with 6.2% in Sydney and 6.1% and Melbourne in the final three months of 2019. HSBC forecasts dwelling prices to rise nationally by five – 9% in 2020 Sydney eight – 12% and Melbourne 10 – 14%. Commercial assets could rise even faster.
The ANZ/Property Council quarterly survey showed that industry professionals expect the rate, or yield, of prime assets to contract by a further 2.7% point over the next 12 months. “We see rates of 4% are unprecedented and, in some respects unsustainable. We are going to see a lot of global capital flow into our market pursuing core assets this year” said non-bank lender MaxCap.
The value of lending for owner-occupied dwellings increased by 2.0% over November nationally and was 12.6% higher than recorded over November 2018. Although investor lending increased the monthly total remained 3.2% lower than recorded over November 2018. “However, investor lending remains 20.3% lower on the same year to date comparisons”, says Metropole’s Michael Yardney.
ABS shows a drop of 10.8% for dwelling approvals in the year up to November 2019.
Forecast
This means that the pent-up demand for dwellings increased significantly during 2019.
What does this mean for dwelling approvals and for the requirement for more housing in Australia?
We believe that this means that the current backlog of dwelling numbers will only be improved by several years of significant dwelling construction increase. This means more townhouses and apartments in the capital cities and single dwellings on city fringes and country areas.
What does this mean for house prices?
This will mean a significant increase of house prices in the short term which will be borne by the individual owner occupier. The credit squeeze imposed by the reserve bank over the past few years has had its effect, and decreased demand, especially for investors. But it has had its toll. Owner occupiers will purchase existing dwellings and probably pay more than it’s worth.
Those same people may choose to build on greenfield sites, which will be a boon for land developers and for housing builders. The developer of apartments and townhouses in built-up suburban areas is still finding it hard to obtain money. Eventually, this will ease and there will be a boom of townhouse and apartment construction in the next few years.
What are the risks of this having a crash?
What is going to happen with dwellings in 2020?
The current situation
“Borrowing costs were not going to rise anytime soon” source HSBC chief economist says in mid-2019 and the Reserve Bank governor repeatedly saying that interest rates are going to stay lower for a considerable period of time.
Meanwhile dwelling values in Sydney and Melbourne finished the year up with 6.2% in Sydney and 6.1% and Melbourne in the final three months of 2019. HSBC forecasts dwelling prices to rise nationally by five – 9% in 2020 Sydney eight – 12% and Melbourne 10 – 14%. Commercial assets could rise even faster.
The ANZ/Property Council quarterly survey showed that industry professionals expect the rate, or yield, of prime assets to contract by a further 2.7% point over the next 12 months. “We see rates of 4% are unprecedented and, in some respects unsustainable. We are going to see a lot of global capital flow into our market pursuing core assets this year” said non-bank lender MaxCap.
The value of lending for owner-occupied dwellings increased by 2.0% over November nationally and was 12.6% higher than recorded over November 2018. Although investor lending increased the monthly total remained 3.2% lower than recorded over November 2018. “However, investor lending remains 20.3% lower on the same year to date comparisons”, says Metropole’s Michael Yardney.
ABS shows a drop of 10.8% for dwelling approvals in the year up to November 2019.
Forecast
This means that the pent-up demand for dwellings increased significantly during 2019.
What does this mean for dwelling approvals and for the requirement for more housing in Australia?
We believe that this means that the current backlog of dwelling numbers will only be improved by several years of significant dwelling construction increase. This means more townhouses and apartments in the capital cities and single dwellings on city fringes and country areas.
What does this mean for house prices?
This will mean a significant increase of house prices in the short term which will be borne by the individual owner occupier. The credit squeeze imposed by the reserve bank over the past few years has had its effect, and decreased demand, especially for investors. But it has had its toll. Owner occupiers will purchase existing dwellings and probably pay more than it’s worth.
Those same people may choose to build on greenfield sites, which will be a boon for land developers and for housing builders. The developer of apartments and townhouses in built-up suburban areas is still finding it hard to obtain money. Eventually, this will ease and there will be a boom of townhouse and apartment construction in the next few years.
What are the risks of this having a crash?
Obtaining Competitive Prices
In obtaining competitive prices or tenders it is important that builders have exactly the same drawings, specifications schedules and documents. If they vary or are incomplete the prices you obtain will be meaningless. This is critical.
Only obtain prices from builders that you know or have researched thoroughly as being excellent in this type of work and who are not too far away. That way you will be confident that you will get a great result from whoever wins the tender.
Your Architects should check the builders who should have a demonstrable track record of carrying this out for other clients. Good tight pricing carried out by your Architects acting as project managers will save you a lot of money and you will end up with a tightly controlled project.
When all the prices are received they should be analysed carefully. Often small anomalies can be sorted out at this time which may include some repricing of some small items.
It is time to go back to your feasibility to make sure that the money is still on target. If not you will need to adjust the building price.
It should also be even-handed. It is not good to have a contract that is less fair on one party. You will end up by suffering the consequences! After all it is you who is taking the risk!
Planning Permit Stage
Nurse, nurse, nurse the way through!
Your drawings, other documents and forms and fees have to be lodged with Council. It will take Council a couple of weeks to assess the information. Council have 60 days in which to issue a permit unless the “clock stops” for any particular reason.
Council may request further information where they believe you have not fully complied with the level of documentation required.
Council may also strongly suggest that you make some design changes to fit their requirements. The officer assessing your application will probably have assessed your application in conjunction with the senior planner to whom they report. At this stage it is critical for your Architects to be fully aware of what Council are trying to achieve and also what you are wanting. Very often your Architects will have a better design that satisfies both.
Once Council are satisfied that you have provided all the information and fit with their requirements they will instruct you to advertise. Advertising generally takes the form of posting letters to surrounding neighbours and placing a sign on each street frontage. Some Councils will advertise entirely themselves on your behalf. Other Councils will direct you to carry out the advertising yourself.
At this point the Council planner will write a report hopefully in your favour. If there are very few objectors Council will issue a favourable Notice of Decision. If there are lots of objectors the matter will go to a committee of Councillors who will recommend to full Council the outcome.
If you do not agree with Council you have 60 days in which to appeal the decision to VCAT. The objectors have 21 days in which to appeal.
Generally the cost of going to VCAT is substantial and risky. For a small development the cost is excessive and an alternative should have been found before this point. However it only takes one neighbouring zealot for you to end up at VCAT! If they are unreasonable you are very likely to win, if they have substantial grounds you will lose. And you will probably deserve to lose! You probably should have seen it coming and should have found alternative strategies to not be in this position!
Once you have a Planning Permit you will find the permit comes with conditions. Your Architects will have also read those conditions and assessed what needs to be carried out at this stage to be included in the set of drawings and documents. They should be sent back to Council for Council to stamp those drawings.
Once those drawings and documents have been stamped you can celebrate!