Developer charges and housing affordabilty in Brisbane, Australia

Bryant, Lyndall (2015) Developer charges and housing affordabilty in Brisbane, Australia. In 22nd European Real Estate Society Conference, 24-27 June 2015, Istanbul, Turkey.


Purpose - This paper empirically examines the effect of developer charges on housing affordability in Brisbane, Australia. Developer paid fees or charges are a commonly used mechanism for local governments to pay for new urban infrastructure. Despite numerous government reports and many years of industry advocacy, there remains no empirical evidence in Australia to confirm or quantify passing on of these charges to home buyers.

Design/methodology/approach - This research applies a hedonic house price model to 4,699 new and 25,053 existing house sales in Brisbane from 2005 to 2011.

Findings – The findings of is research are consistent with international studies that support the proposition that developer charges are over passed. This study has provided evidence that suggest developer charges are over passed to both new and existing homes in the order of around 400%.

Research limitations/implications - These findings suggest that developer charges are thus a significant contributor to increasing house prices and reduced housing affordability.

Practical/Social Implications: By testing this effect on both new and existing homes, this research provides evidence in support of the proposition that not only are developer charges over passed to new home buyers but also to buyers of existing homes. Thus the price inflationary effect of these developer charges are being felt by all home buyers across the community, resulting in increased mortgage repayments of close to $1000 per month.

Originality/value - This is the first study to empirically examine the impact of developer charges on house prices in Australia. These results are important as they will inform governments on the outcomes of growth management strategies on housing affordability, providing the first evidence of its kind in Australia.

Impact and interest:

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ID Code: 84656
Item Type: Conference Paper
Refereed: Yes
Additional URLs:
Keywords: Housing Affordability, Developer charges, Impact Fees, House Prices, Growth Management
Subjects: Australian and New Zealand Standard Research Classification > BUILT ENVIRONMENT AND DESIGN (120000) > URBAN AND REGIONAL PLANNING (120500) > Urban Analysis and Development (120507)
Australian and New Zealand Standard Research Classification > COMMERCE MANAGEMENT TOURISM AND SERVICES (150000) > COMMERCIAL SERVICES (150400) > Real Estate and Valuation Services (150403)
Divisions: Current > QUT Faculties and Divisions > Science & Engineering Faculty
Copyright Owner: Copyright 2015 [please consult the author]
Deposited On: 04 Jun 2015 00:46
Last Modified: 11 Sep 2015 08:31

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