Maxwell Shifman

I was asked by @theheraldsun to opine on the policy announcements from @VictorianLabor and @LiberalVictoria. My thoughts were slightly truncated in print, so here is what I actually said in full. Labor Party ✅Positives • Reduced appeal rights and deemed to comply standards will reduce unnecessary and vexatious delays on compliant projects • Improved townhouse code will help gentle densification in inner and middle rings ⛔Negatives • Activity Centres program delivers theoretical gains only. It ignores high construction costs and subdued demand relative to other types of homes. • "Horizon" greenfield PSP release program is substantially slower than in the past and remains behind schedule. • Infrastructure overspend in SRL precincts takes away from spend needed in other emerging areas Liberal Party ✅Positives • Fast tracked PSP program has potential to make a big housing supply difference - as long as infrastructure is delivered to match • Expanding regional growth focus will help offset growth challenges in Metro Melbourne ⛔Negatives • Expanding CBD zone does not improve apartment feasibility • More detail needed on infrastructure funding to match greenfield rollout • Need to ensure middle ring remains open to gentle densification 🤔I'm sure many more announcements to come into the lead up to 28 November. #housingsupply #elections #policyreform #victoria #planningreform #feasibility

How do Israel-Palestine protests relate to antisemitism, Jew hate and Islamism? linkedin.com/pulse/how-do-i…

We see @VictorianLabor announcing higher taxes and higher property price today, to build their white elephant @suburbanloop. In 20 years from now you will have a choice - get into an autonomous car, that will pick you up from your door and drop you directly where you want for half the price of getting on a train, that you will have to walk km’s to the station at both ends of your trip. This isn’t just economic vandalism, it’s blatant corruption, jobs for unions to stay in power. They shouldn’t just be kicked out of parliament, those responsible should be considered for criminally prosecution for intentionally and fraudulently misappropriating taxpayers money. #Auspol2025

➕Let's do some quick @suburbanloop "value capture" math ✖️: - Land Tax ($5.7B) - Not value capture. It's a cynical redirection of existing state taxes, robbing funding from other things. - 70,000 dwellings + contributions ($2.9B) - quick math shows this is an average of $41,428/dwelling? #mathaintmathin. At the new Activity Centre $11,500 rate = $805 million, growing to ~$34,000 per dwelling -from 2035. Developers can't make projects #feasible now, let alone with additional cost imposts. Don't forget the actual the uplift is only 25,000 dwellings over status quo. - Windfall Gains Tax ($450M) - astounding if it delivers this much across the precincts based on current valuations and exemptions - Carpark Levy ($800M) - talk about disincentivising commercial investment in these areas! The current Melbourne CBD levy raises around $110m p.a., so what fraction of that would SRL precincts do? 10%? - "State Initiated" Development ($1.6B) - Made up number, basically assuming government land has zero value as-is. I'd be amazed if $1.6B was even the completed value of developments, which is not remotely the same as creating $1.6B of (increased) value. There is no conceivable way these value capture mechanisms will get close to delivering $11.5 billion of new value, especially once the double counting on land tax is removed (robbing Peter to pay Paul...). #SRL #boondoggle

Max Shifman, said the government needed to stop treating property development like its “personal cheque book” and start clearing planning backlogs and boosting funding in growth areas. “Quit focusing on announcements and new processes, and just get stuff done,” he said. “And roll out better infrastructure spending spread across Victoria.”

You seriously don't understand the cost of new development or what makes it feasible. In most suburbs across Australia, it is not the case, and certainly not like:like which is my primary point. If it was the case, why aren't we seeing scale new development everywhere? There is a reason new apartments are almost exclusively being built in expensive suburbs, where that dynamic actually is true. Don't confuse relative affordability with actual affordability.

@maxw3l @yimbymelbourne You seriously can’t follow what i said?

New apartments & townhouses are cheaper than the old detached houses they replace. We should allow cheaper housing options to be built where people want to live.

@Mercfan3Mercfan @yimbymelbourne Not necessarily (at all) if looking at the price of new apartments.

@maxw3l @yimbymelbourne Comparing an apartment to a detached house on say 600sqm in the same suburb? Of course there’s a significant price difference that is the point.

@Llib7 Love you picking the extremes

Well yes there was value added and more importantly supply was added. I’d hate to see the actual prices of derelict housing stock if no supply is added. Well you don’t need to look far for that 👇🏻 realestate.com.au/news/crumbling…

I disagree that it "generally" holds true. It rarely does, particularly with the newer cost base. How often do you see a house get knocked down in an established area, only to be replaced with 2-3 townhouses each more expensive than the original dwelling? New apartments need an absolute minimum of $15k/m2 anywhere in Melbourne ($20k/m2+ would be the starting point in better locations). This chart remains fundamentally disingenous in the message it is trying to convey.

@maxw3l @GrattanInst @yimbymelbourne It’s a rough comparison but it generally holds true. An established house is usually an older building than a 3 bedroom apartment and even then their sale prices are still much higher than an apartment, even with a similar number of bedrooms.

This @GrattanInst and @yimbymelbourne nonsense has to cease. The chart compares the price of all homes against all "new" units - "new" being sales of units within the last 5 years. 1. Established houses have more space/utility (bedrooms etc.) than what they have compared as "new" unit. Not a like:like comparison. 2. So-called "new" dwellings, especially in the 10km inner ring, are mostly small 1-2 bedrooms units in high rise which have for the most part lost value over their new price. 3. The replacement cost for the same units in today's market would be anywhere between 30% and 100% more than the prevailing "existing" price due to cost escalation. In many cases paying more for a new, smaller unit than an existing detached house. 4. Comparing a new like:like (i.e. 3bed home vs 3bed apartment) you would find the cost of the apartment is likely greater than the median house price.

@metrotunnelvic Meanwhile today: theage.com.au/national/victo…

🚆@metrotunnelvic opens tomorrow, so let's get some facts straight 1️⃣ 𝗜𝘀 𝗶𝘁 𝗲𝗮𝗿𝗹𝘆? 𝗢𝗿 𝗹𝗮𝘁𝗲? The original 2011 Business Case stated it would be open "by 2026" to avoid "CBD rail gridlock". It's squeaked into the end of 2025. 𝘐𝘵'𝘴 𝘳𝘪𝘨𝘩𝘵 𝘰𝘯 𝘵𝘪𝘮𝘦. People arguing it's late are confusing Metro with the West Gate Tunnel, which is indeed years late. 2️⃣ 𝗜𝘀 𝗶𝘁 𝗼𝗻 𝗯𝘂𝗱𝗴𝗲𝘁? No. The 2016 updated Business Case forecast was $10.9B. It's ended up around $13.5B, 24% higher. Edit: this is capital cost only. The smoke and mirrors is the true cost is around $15.5B once financing and setup costs are considered - a 42% increase. 3️⃣ 𝗗𝗼𝗲𝘀 𝗶𝘁 𝗺𝗮𝗸𝗲 𝗲𝗰𝗼𝗻𝗼𝗺𝗶𝗰 𝘀𝗲𝗻𝘀𝗲? Highly unlikely. The 2016 Business Case showed a wafer-thin Benefit-Cost Ratio (BCR) of 1.1, lifted to 1.5 by considering "Wider Economic Benefits" (WEB) - 𝘵𝘩𝘦𝘰𝘳𝘦𝘵𝘪𝘤𝘢𝘭 𝘨𝘢𝘪𝘯𝘴 𝘧𝘳𝘰𝘮 𝘢𝘨𝘨𝘭𝘰𝘮𝘦𝘳𝘢𝘵𝘪𝘰𝘯 𝘢𝘯𝘥 𝘱𝘳𝘰𝘥𝘶𝘤𝘵𝘪𝘷𝘪𝘵𝘺 𝘤𝘭𝘶𝘴𝘵𝘦𝘳𝘪𝘯𝘨. A BCR should be >1.0 to make a project worthwhile. The cost increases alone mean the underlying BCR drops to 0.77,or 1.0 if the flaky WEB are considered. 📉𝘛𝘩𝘦 𝘣𝘪𝘨𝘨𝘦𝘳 𝘱𝘳𝘰𝘣𝘭𝘦𝘮 𝘪𝘴 𝘵𝘩𝘦 𝘢𝘴𝘴𝘶𝘮𝘱𝘵𝘪𝘰𝘯𝘴 𝘢𝘳𝘰𝘶𝘯𝘥 𝘳𝘪𝘥𝘦𝘳𝘴𝘩𝘪𝘱. Public transport usage remains 23% below pre-pandemic levels, let alone the higher level projected by 2025 in the Business Case. That kills the assumptions on the theoretical economic gains, which are being killed with current utilisation of the CBD and surrounds. 🤔 𝗧𝗵𝗲 𝗦𝘂𝗺𝗺𝗮𝗿𝘆 Metro Tunnel is definitely an engineering and architectural achievement, one that will reshape movement patterns around the city. But let's be real: the “𝘢𝘩𝘦𝘢𝘥 𝘰𝘧 𝘴𝘤𝘩𝘦𝘥𝘶𝘭𝘦” opening and “𝘵𝘳𝘢𝘯𝘴𝘧𝘰𝘳𝘮𝘢𝘵𝘪𝘰𝘯𝘢𝘭 𝘣𝘦𝘯𝘦𝘧𝘪𝘵𝘴” are definitely overstated. 𝗛𝗮𝗽𝗽𝘆 🚅 𝘁𝗿𝗮𝘃𝗲𝗹𝘀

𝙋𝙪𝙩 𝙖𝙣𝙤𝙩𝙝𝙚𝙧 𝙬𝙖𝙮, 𝙖𝙣 𝙞𝙢𝙢𝙚𝙙𝙞𝙖𝙩𝙚 𝟲𝟰.𝟰% 𝙞𝙣𝙘𝙧𝙚𝙖𝙨𝙚 𝙤𝙣 𝙩𝙝𝙚 𝙡𝙖𝙨𝙩 𝙮𝙚𝙖𝙧'𝙨 𝙖𝙫𝙚𝙧𝙖𝙜𝙚, 𝙢𝙖𝙞𝙣𝙩𝙖𝙞𝙣𝙚𝙙 𝙖𝙩 𝙩𝙝𝙖𝙩 𝙥𝙖𝙘𝙚 𝙛𝙤𝙧 𝟯𝟮 𝙢𝙤𝙣𝙩𝙝𝙨. 🎯Does anyone still think the target is achievable?

🤔What is we wanted to catch up from here? Well, at the 95% CR, 1,263,158 approvals are needed over 5 years. With 418,493 approvals to-date, 𝗮𝗻𝗼𝘁𝗵𝗲𝗿 𝟴𝟰𝟰,𝟲𝟲𝟱 𝗮𝗿𝗲 𝗿𝗲𝗾𝘂𝗶𝗿𝗲𝗱 𝗶𝗻 𝘁𝗵𝗲 𝗻𝗲𝘅𝘁 𝟯𝟮 𝗺𝗼𝗻𝘁𝗵𝘀. 𝟮𝟲,𝟯𝟵𝟲 𝗲𝗮𝗰𝗵 𝗮𝗻𝗱 𝗲𝘃𝗲𝗿𝘆 𝗺𝗼𝗻𝘁𝗵, 𝗼𝗻 𝗮𝘃𝗲𝗿𝗮𝗴𝗲.

🧮Time for some #housingtarget math. 𝘛𝘩𝘦 𝘢𝘪𝘮: 1.2 million new homes from 1 July 2024 to 30 June 2029. Follow along...