The myth that the provision of affordable land will in some way have a negative effect on those who own existing property is much to the detriment of our community, its economy and the future of its children. Ask yourself this: What would your house be worth if Alice Springs turned into a ghost town, a FIFO mining camp, or a mere welfare institution?
Growth and opportunity are the basic essentials of a vigorous economy, without them decline is a certainty.
In years gone by the Territory Government provided a housing scheme that made it very easy and affordable for young people to own a home.
This scheme was very successful, it attracted people from all over the country they put down roots and made our community what it is today, many of them going on to be successful business and property owners using their first home as a stepping off point on that journey.
For many years Alice reaped the rewards of a vibrant economy created off the back of that scheme. Tragically in later years the politics and policies of greed often peddled by those who gained so much from it began to strangle that success.
The deliberate cutting of land supply led to escalating property prices and escalating rents which while making fortunes for some, led to a decline in affordable opportunity for everyone else.
Those on lower incomes began to find that they were really struggling to survive, they began to pack and move on; others moving in to take their place quickly found themselves in similar circumstances and took the same option.
This cyclical movement of population has the community debilitating effect of making our population many times more transient than it otherwise would be, bringing about loss of community involvement, loss of corporate knowledge, constant retraining, constantly dealing with new chums leading to constant delays when dealing with bureaucracy, poor service, often uncaring service, businesses left struggling to find staff.
Good business a greater and greater burden are often weighed down even further by poor quality staff who are fully aware that they cannot easily be replaced.
The secondary effect of high rents is that the working population cut back on visiting clubs, restaurants and cinemas, all the non essentials but the very thing that give a community life.
Small business gets the double whammy, high rents and fewer customers, which eventually sends them to the wall. This in turn lessens the overall amenity, making the community a less pleasant place to live. Then there is the generational aspect, our own home grown children starting out like everybody else at the bottom, also finding they can’t afford to stay, that there is no affordable way for them to gain a foothold towards building their own lives.
Many move on, which in turn sets those left behind to contemplate their own exit in pursuit. The result being, that instead of having a happy community, vigorously working to build their lives and make their community and their home a better place, you end up with a community more like a bush camp, where everyone’s working to leave.
You can’t change this scenario by glaring at the world from the battlements of your imagined castle failing to deal the very thing that holds it up – its foundations! In the past 30 Alice Springs has lost none of its opportunity, in fact it has more than ever before!
Yet we struggle because we’ve built castles in the air, we have no foundations! We have cut them off. Our workers are our foundations. To rebuild a healthy economy we must rebuild a stable committed workforce!
To bring that about requires the provision of incentive, the greatest incentive to a workforce is affordability. Affordable land. Affordable rents. We are told by government that the new subdivision of Kilgariff fulfils this requirement, is that really the case?
Presently the cheapest available land is around $190,000. To put a modest house on it around $300,000, leaving a builder with very little profit incentive to build it in the first place, going on the market at $500,000. Paying that off will cost around $700 a week Do we think that’s affordable?
Is there an incentive for the workers who fill jobs, many jobs, paying under $60,000? I don’t think so.
The land could be sold at half the existing cost and still not undercut existing lower end property prices. We should be developing incentives such as throwing in the land for free if you signed up for a 10 year minimum residency or five years rent, then convert to purchase. No credit checks – rent record being proof of capability.
The more happy contributing workers we have making their lives and homes here, the safer your existing investment becomes! Worth a thought I think, and if you really value your existing investment. Worth fighting for!
I was reading about two towns in western New York State in the early nineteenth century recently. One of the towns had a “progressive” land policy and thrived, while the other didn’t.
Consequently, things like a railway and a canal went to the one that thrived. Normanton, in the gulf, is an example of what can happen when opportunity passes you by.
Opportunity must be created, but governments are not good at legislating against greed, mainly because of vested interest, e.g., alcohol industry NT political campaign donations to the tune of $300,000 last election, while the Chief Minister issues press releases saying how he is “working with the alcohol industry”, citing declining statistical evidence, which is a bit like saying we’ve attacked the effect, but the cause is untouchable.
I think you’ve made some good points here, Steve, but I don’t know how you can change the situation and that’s a result of “progressive” policies, which like take-away alcohol, have progressed beyond a community like Alice Springs’ ability to rein in.
One would think that this begins with a Council-led challenge in cooperation with the Chamber of Commerce, Rotary, Lions, etc, but it may be that the freemasonry of those outfits make vested interests impregnable to common sense. Excuse me for yawning.
In any case, maybe a ghost town, or the kind of town that you describe has to happen, like Las Vegas, before we who have escaped to the hills beyond can look down on Hiroshima or Jerusalem and say, “What happened, bro?” Have a nice day.
I can’t comment on the details of Steve’s article as the economics are over my head. But I do know that Alice is struggling.
Walk into Alice Plaza – it’s got that ghost-town feeling that hardly lends itself to happy shopping.
OneSteel is shutting up shop. Is the Water Tank still in receivership, or has that been sorted? Anyone else leaving town?
Council may have to sell some parks to have the money to maintain the rest.
And as for land and house prices, for the first time that I can recall, it’s now cheaper to rent than to own. Or so a renting friend recently informed me, having looked to buy and walked away from the high prices.
As for the high business rents, who owns the buildings where the rents are too high for a business to make a go of it?
And Monte’s, which caters for the young crowd, gets hammered on a regular basis.
Like Steve says, we better start making Alice attractive to the next generation if we want them to build their lives here. That means affordable homes, affordable land, affordable business rents, somewhere fun to go at night – seems pretty basic to me.
It’s Steveonomics Hal. Alan Greenspan can’t even wrap his head around it.
Oops!
And apologies to the Water Tank. I meant to say that I understand the Water Shed has recently gone into receivership. I hope hasn’t, or that it gets sorted and can stay here. Alice needs both of them.
“Good business … often weighed down even further by poor quality staff who are fully aware that they cannot easily be replaced” – SPOT ON!!
Tell me about it … if you ask those lazy, fit-for-nothing idiots making easy money to raise their work performance, you get accused of bullying!?
“The secondary effect of high rents is that the working population cut back on visiting clubs, restaurants and cinemas” – golden words! And they talk about DEVELOPING THE NORTH… PLEASE COME AND VOICE YOUR OPINION PEOPLE during the Developing the North Regional Summit in Alice Springs on Friday, August 29th, 5 to 7 pm, Grand Ballroom, DoubleTree by Hilton, 82 Barrett Drive, Alice Springs.