Land speculators with portfolios in Coolaroo, Cranbourne East, Caroline Springs, Nunawading and Parkville will be celebrating with their second free lunch in as many weeks.
Brumby’s announcement of new train stations in these suburbs has delivered windfall gains to those speculating on future infrastructure projects. One just needs to visit Coolaroo to see a number of vacant or under-utilised sites laying in waiting for such an announcement.
This handout follows hot on the heels of the 134,000 lot expansion in the 2030 boundary last week and the 90,000 re-zoning Brumby performed for the property lobby in March this year. It certainly rounds off a productive year for Melbourne’s real estate lobby. Surely there is no doubt as to who are the biggest contributors to state government coffers?
Whilst some are laughing all the way to the bank, commuters are befuddled at why they are facing a 5% increase in rail fares during an age of climate change.
These two extremes could be neutralised via a Land Value Capture system. If all landholders in the vicinity of the new train stations were to pay 5% of their land value back to the government over 20 years, then future rail expansions could occur within the time frame that future generations expect. This is how Japan and much of East Asia has profitable rail systems.
This handout is especially concerning when the 2008 I Want to Live Here report found thousands of inner city properties lying vacant. Why the need to stretch our infrastructure when central locations could be used more effectively with a more logical tax system?