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Report: Melbourne to Top Sydney as Australia’s No. 1 City by 2037

wyliepoon

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http://www.businessweek.com/news/20...sydney-as-australia-s-no-1-city-update1-.html

Melbourne to Top Sydney as Australia’s No. 1 City
April 27, 2010, 2:15 AM EDT


By Nichola Saminather

April 27 (Bloomberg) -- Melbourne could overtake Sydney to become Australia’s largest city by 2037 as home construction in the harbor-city trails the pace of its southern rival, according to a report by economic forecaster BIS Shrapnel.

Sydney’s population growth rate will fall to 0.9 percent a year from a projected 1.1 percent if New South Wales state doesn’t simplify its planning system to allow more home building, Aaron Gadiel, chief executive officer at the Urban Taskforce, which commissioned the report, said in a statement. Melbourne will see population growth of about 1.3 percent a year, Gadiel said, swelling the number of people there to 5.7 million by 2036.

“Over the past decade, Melbourne has proved far more capable of accommodating extra people than Sydney,†he said. “If the recently revised state government Metropolitan Strategy housing targets for Sydney are delivered, then Sydney’s population in 2036 would remain greater than that in Melbourne. However, that’s simply not going to happen without significant reform of the planning system.â€

Sydney -- home to the Opera House, Harbour Bridge and Bondi Beach -- and Melbourne, host to the Australian Open tennis tournament, share a cultural and sporting rivalry dating back to colonial times. Melbourne boasts the local head offices of five of Australia’s 10 biggest companies by market value including BHP Billiton Ltd. and Telstra Corp., edging out Sydney’s four.

Melbourne home prices rose 18.5 percent in the fourth quarter from a year earlier, eclipsing Sydney’s 12.1 percent advance in the three months to Dec. 31, according to Australian Property Monitors. The government’s first home-buyer initiatives pushed demand higher even as the global financial crisis and government regulations curbed developments.

Supply

Without reform, the supply of additional homes would reach 17,000 a year, below the minimum 25,000 a year needed for Sydney to “keep its head above water,†Gadiel, who heads the representative group for property developers and equity financiers, said.

At this rate, New South Wales’s share of overseas migrants -- needed to bolster the economy as the population ages -- would shrink to 25 percent, the report said.

The housing shortage and rising prices have already pushed New South Wales’s portion of immigrants to 30 percent now from 40 percent in the 1990s, according to Jason Anderson, senior economist at BIS Shrapnel.

Victoria state is currently building new homes at double the rate of New South Wales, the BIS report found.

“Sydney is not getting the housing puzzle right at the moment,†said Ben Phillips, senior economist at the Housing Industry Association. “Developers and industry groups have been calling for these changes for years. The problem is you can’t get one level of government to solve this problem. We need to get an all-of-government solution for this.â€

Metropolitan Strategy

Sydney’s metropolitan strategy, a plan for the city released by the state’s government, estimates the city will need an additional 640,000 new homes by 2031.

About 30 percent of these new homes should be built on newly released land, with the rest added to already built-up, or infill, areas, the metropolitan strategy says.

Yet, New South Wales’ development policies don’t support this aim, Anderson said on April 15.

“In Victoria, for example, you get stamp duty concessions when buying new apartments, where you only pay it on land, not the building,†Anderson said. “But you don’t have that in Sydney. The government has said it wants 70 percent of new supply from infill development, but it won’t change policy to reflect that.â€

New South Wales must “limit bureaucratic and political†games by ensuring proposals that meet standards receive approval; make authorities work on stricter timetables; clarify matters to be considered while assessing developments; and cut development levies, the BIS Shrapnel report recommends.

Affordability

The New South Wales government’s focus on infill development has contributed to making Sydney the second-most unaffordable city in the annual Demographia International Housing Affordability Survey, according to the report’s authors. The report, which compared 272 markets in the U.S., U.K., Canada, Ireland, New Zealand and Australia in the third quarter of 2009, ranked Vancouver as the most unaffordable housing market.

Residential land release in Sydney fell to 2,000 lots per year in 2007 from a historic average of 10,000 lots as a result of the New South Wales government’s high-density policies, the report said.

Sydney home prices will rise 32 percent between 2009 and 2013, BIS Shrapnel estimates.

Australia-wide, the gap between how many homes are supplied and how many are needed increased by 78,900 dwellings in the year to June, a government report today showed.

“The housing supply issue includes a diverse range of issues including land supply, council approval processes, labor and capital availability, and taxation,†HIA Chief Executive Graham Wolfe said in a statement. “Failure to address these considerale issues will have dire outcomes for the cost of housing for both those purchasing homes and those who remain in the rental market.â€
 
The New South Wales government’s focus on infill development has contributed to making Sydney the second-most unaffordable city in the annual Demographia International Housing Affordability Survey, according to the report’s authors. The report, which compared 272 markets in the U.S., U.K., Canada, Ireland, New Zealand and Australia in the third quarter of 2009, ranked Vancouver as the most unaffordable housing market.

Looks like Wendell Cox is still up to his old tricks.
 
NSW is like Australia's Quebec, the state government is so bloated and out of touch it makes the other states look good.
 
NSW's problems lie in the fact politics up there has been, during the Howard years, so focused on the federal level - all the Liberal and Labor talent went to Canberra, and nothing's left at the state level. It's the same old ALP changing its leader every 18 months, and the Liberal opposition is completely toothless.

It's actually a country-wide problem with Liberal oppositions, Victoria's pretty much in the same boat as NSW, except the previous Liberal government in Victoria did all the things that the current NSW ALP government is now trying to do, like sell off power assets (Victoria is a completely privatised and there is retail competition, everywhere else the state governments own the assets).

It seems like every 2 years a new "metro" proposal sees the light of day and then gets canned 12 months later in Sydney, in short: they've got their thumbs stuck up their own arses.
 
funny that this appeared over the weekend...

http://www.smh.com.au/nsw/sydney-worstplanned-city-in-australia-20100613-y64m.html

SYDNEY'S strategic metropolitan planning is the worst of Australia's major capital cities, leaving it exposed to a lack of federal government funding for essential infrastructure projects.

A survey to be released today by KPMG ranks Sydney in sixth place, with Melbourne at the top, followed by Brisbane, Adelaide, Perth and Canberra.

The table ranks all capital cities on criteria drawn up by the Commonwealth of Australian Governments relating to infrastructure, urban design, land release and the like.

From 2012, the federal government intends to allocate infrastructure funds on the basis of how the capital cities rank on these criteria. Based on this survey's findings, Sydney will continue to struggle to receive federal funding for major infrastructure projects.

The survey found Sydney ranks poorly in the areas of implementation and infrastructure of urban planning and design, trailing almost all other capital cities in these two areas.

''Sydney's rank … is partly a reflection of its performance in relation to managing congestion. Without delivery of further major transport infrastructure, this challenge is likely to worsen, due to forecast increasing population growth,'' KPMG noted in the report.

The Property Council of Australia and groups such as the Planning Institute of Australia and the Australian Institute of Architects funded the KPMG research.

''Some of the moves NSW has taken recently, such as the newly established Sydney Metropolitan Development Authority and matching some infrastructure and land use needs is where Sydney is starting to get it right,'' the acting NSW executive director of the Property Council, Glenn Byres, said.

''But we need a quantum shift in the transport space, for example. You can't have the recent flip-flops on transport … you can't announce and then abandon projects and expect to stay ahead of the congestion curve.''

The lack of certainty of large transport infrastructure projects in Sydney, with the shelving of the Metro projects and the north-west rail link, indicates that land delivery policies are also failing as a result, the report noted.

"The pressing demand for robust and deliverable strategic plans will become stronger as Sydney expands towards a population of 7 million people by 2050," Mr Byres said.

"Access to Commonwealth infrastructure funding is now also contingent on the presence of strong capital city strategic plans mandated by COAG.

"There is no time to waste and NSW needs to build on recent initiatives that illustrate an appetite for reform and an ability to reshape institutional capacity.''


The KPMG report also found that consolidating the Sydney Metro Strategy and Metropolitan Transport Plan into one document will assist the cause of better strategic planning - provided the transport vision also represents a 25-year vision

But NSW's mixed track record of implementing transport projects has undermined confidence in the state's investment priorities, with the need to better monitor, report on and improve progress towards critical spatial
targets, it said.
 
^Ha ha. Sounds like Australia's largest city shares something in common with Canada's largest city.

It's unlikely that Montreal will be Canada's largest city by 2037, though.
 
I reckon Melbourne has the advantage of having a whole state to itself. 75% of Victorians live in Melbourne, so the state government really pays attention to urban issues. Plus the economy is urban based unlike in the mining states.
 
Everyone: Interesting read about Australia's largest cities-the Sydney vs. Melbourne comparison does remind me of Toronto vs. Montreal without the language difference!
LI MIKE
 
But that tiny little language factor makes all the difference. The global language of trade is overwhelmingly English, yet Quebec has laws specially stating that a company needs to operate in French. They face very big problems there, and when you've got another city just 600 km away that speaks English and is a world city with similar infrastructure, you're probably gonna want to go there. This is a problem that Quebec needs to find a fix to, probably by studying very intently the economy that exists in places like Europe, where they are keen on protecting their language and culture similarly to Quebec.
But I would say that France and Italy are a bit more liberal in their culture and language than Quebec is. Is this because of the establishment of their culture, or the diversity of Europe, or the nondiversity of North America? These are problems that'll need to get solved, because Quebec will be swamped if it continues to act as it has. It's doing a pretty poor job of maintaining French culture, and the internal struggle to maintain the culture in the province is actually deadlocking the entire Canadian political system.
 

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