Canberra's Influence on the Surrounding NSW Economic And
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Canberra’s Influence on the Surrounding NSW Economic and Housing Markets Final Report - October 2015 Prepared for the NSW Department of Planning and Environment This report has been prepared for the NSW Department of Planning and Environment. SGS Economics and Planning has taken all due care in the preparation of this report. However, SGS and its associated consultants are not liable to any person or entity for any damage or loss that has occurred, or may occur, in relation to that person or entity taking or not taking action in respect of any representation, statement, opinion or advice referred to herein. SGS Economics and Planning Pty Ltd ACN 007 437 729 www.sgsep.com.au Offices in Canberra, Hobart, Melbourne and Sydney TABLE OF CONTENTS EXECUTIVE SUMMARY 1 Objective 1 Demographic context 1 Impact of the ACT on housing markets in surrounding NSW 1 Dwelling Types 2 Economic and employment factors impacting housing markets over time 4 Employment and Economic Growth in the SE and Tablelands Region 5 Economic Growth Opportunities 5 Economic Growth Challenges 6 Recommendations 7 1 INTRODUCTION 9 1.1 Background to the project 9 1.2 Objectives 10 1.3 History of the Australian Capital Territory 11 1.4 Broader demographic changes 11 1.5 Population in the ACT and adjacent areas of NSW 13 1.6 Impact of the ACT on New South Wales 14 1.7 Findings from previous reports 14 2 EMPLOYMENT AND POPULATION MOVEMENTS 16 2.1 ACT workers living in NSW 16 2.2 Migration of people between the ACT and surrounding NSW 16 2.3 Population ageing 22 3 HOUSING MARKETS 23 3.1 Dwelling types in ACT and surrounding NSW 23 3.2 Impact of ACT’s higher wages on house prices 24 3.3 Residential developments close to the ACT border 25 3.4 Rural residential development 27 Murrumbateman 30 Yass 30 Gundaroo 31 Wamboin 31 Bungendore 31 Bywong 32 Collector 32 Carwoola 32 3.5 Trends towards higher density living 33 ACT’s Planning Strategy and Indicative Land Release Program 35 New Development in Queanbeyan 35 Canberra’s Influence on the Surrounding NSW Economic and Housing Markets 3.6 Holiday homes, hobby farms, retirement and investment properties. 36 4 EMPLOYMENT BY INDUSTRY 38 4.1 Employment in and around the ACT 38 4.2 Tourism 41 5 CROSS BORDER SERVICES 44 5.1 Health Care 44 5.2 Schools & Education 45 5.3 Shopping, recreation, cultural and sporting activities. 46 6 TRANSPORT 48 6.1 Barton Highway duplication 48 6.2 Kings Highway 48 6.3 Other roads & regional connections 49 6.4 Public Transport 50 6.5 Canberra Airport 52 7 REGIONAL ECONOMIC GROWTH OPPORTUNITIES AND RECOMMENDATIONS 54 7.1 Opportunities to benefit from economic growth in the ACT 54 7.2 Regional strengths enhanced by proximity to the ACT 56 7.3 Water, environmental and planning issues 56 7.4 The National Broadband Network 58 7.5 Financing holiday season infrastructure 60 7.6 Better co-ordination of cross border service delivery 61 7.7 Recommendations 63 8 APPENDIX 1 65 Previous Reports 65 Canberra’s Influence on the Surrounding NSW Economic and Housing Markets LIST OF FIGURES FIGURE 1: SE AND TABLELANDS REGION 10 FIGURE 2. MAP SHOWIN G POPULATION GROWTH RATES 2001-2011 12 FIGURE 3. POPULATION GROWTH RATES, ACT AND SOUTH EAST NSW, 1992-2014 14 FIGURE 4. AGE PROFILE OF RESIDENTS THAT MOVED TO ACT WITHIN THE LAST FIVE YEARS – TOP 15 LGAS, 2011 18 FIGURE 5. EMPLOYMENT STATUS OF RESIDENTS THAT MOVED TO ACT WITHIN THE LAST FIVE YEARS – TOP 15 LGAS, 2011 18 FIGURE 6. AGE PROFILE OF PREVIOUS ACT RESIDENTS THAT HAVE MOVED OUTSIDE OF ACT WITHIN THE LAST FIVE YEARS – TOP 15 LGAS, 2011 20 FIGURE 7. EMPLOYMENT STATUS OF PREVIOUS ACT RESIDENTS THAT HAVE MOVED OUTSIDE OF ACT WITHIN THE LAST FIVE YEARS – TOP 15 LGAS, 2011 21 FIGURE 8. AGE-SEX PROFILE OF ACT ( 2011) 21 FIGURE 9. PERSONAL INCOMES BY DISTANCE FROM ACT, 2011 25 FIGURE 10. RELATIONSHIP BETWEEN PRICE AN D DISTANCE FROM CANBERRA 26 FIGURE 11. RELATIONSHIP BETWEEN RURAL ZONING AND DISTANCE FROM CANBERRA, PALERANG LGA 29 FIGURE 12. CHANGE IN NUMBER OF DWELLINGS BY TYPE, 2 006-2011 33 FIGURE 13. UNOCCUPIED PRIVATE DWELLINGS BY LGA, 201 1 CENSUS 37 FIGURE 14. INDUSTRIES BY SHARE OF LGA EMPLOYMENT AN D LGA DISTANCE TO CANBERRA 40 FIGURE 15. MAP SHOWING NSW TOURISM REGI ONS, 2015 42 FIGURE 16. INDUSTRY CONCENTRATI ON AND GROWTH IN THE ACT 55 FIGURE 17. MAP SHOWING NBN ROLLOUT 59 FIGURE 18. WEST BELCONNEN 62 LIST OF TABLES TABLE 1. LONG TERM POPULATION CHANGES, CAPITAL REGION 11 TABLE 2. POPULATION CHANGES ACROSS AUSTRALIA 13 TABLE 3. REGIONAL STRATEGIES AND REPORTS 15 TABLE 4. RESIDENT WO RKERS FROM SURROUNDI NG LGAS WORKING IN ACT – TOP 5 LGAS, 2011 16 TABLE 5. PLACE OF RESIDENCE FIVE YEARS AGO FOR CURRENT ACT RESID ENTS – TOP 15 LGAS, 2011 17 TABLE 6. NUMBER OF P REVIOUS ACT RESIDENTS FROM FIVE YEARS AGO – TOP 15 LGAS, 2011 19 TABLE 7. NET POPULATION MOVEMENTS BETWEEN ACT AND SELECT LGA S, 2006-2011 19 TABLE 8. GROWTH BY AGE BRACKET, CANBERRA AND SURROUNDING NSW, 2011-2031 22 TABLE 9: INCREASE IN PRIVATE OCCUPIED DWELLINGS IN ACT AND ADJACENT LGAS 23 TABLE 10. DWELLING TYPES IN ACT AND NSW, 2011 (%) 23 TABLE 11. MEDIAN NON -UNIT VALUES ($), 2004-2014 25 TABLE 12. MEDIAN WEE KLY RENT ($) FOR 3 BEDROOM HOUSE, 2009-2014 27 TABLE 13. MEDIAN NON -UNIT (HOUSE AND LAND ) VALUES ($), 2004-2014 29 Canberra’s Influence on the Surrounding NSW Economic and Housing Markets TABLE 14. ACT IND USTRIES EMPLOYMENT (‘000) 38 TABLE 15. EMPLOYMENT BY INDUSTRY, 2011 39 Canberra’s Influence on the Surrounding NSW Economic and Housing Markets EXECUTIVE SUMMARY Objective This report assesses how the ACT influences housing markets and economic development in the surrounding South East and Tablelands Region of NSW, including the geographic spread and distribution of this influence. It also identifies how the proximity of Canberra can impact on and provide opportunities for surrounding NSW. Demographic context The population of the ACT is currently 389,700. At the 2011 Census it was 368,000. It is projected to reach 483,000 by 2026 and 557,000 by 2036. This would be an increase of 51.4% between 2011 and 2036. The 2011 population of NSW LGAs in the SE and Tablelands Region was 261,800, and is forecast to increase by 48,650 to reach 319,400 by 2036. This would be an increase of 22% between 2011 and 2036. The bulk of this growth is forecast to occur in LGAs within easy commuting distance of Canberra; in particular Queanbeyan (18,500), Yass Valley (6,250), and Palerang (5,700). Over the 2013-14 year, the population of the Queanbeyan region grew by 220, the Yass region grew by 200, and the Goulburn region grew by 180. Over this same period, the population of many other local government areas in NSW declined.1 LGAs in the SE and Tablelands Region that are forecast to show static or declining populations tend to be an hour or more from the ACT, and also away from beach or snow tourist areas; for example, Bombala, (-250) Harden (-500) and Booroowa (0). As discussed further in Sections 1.3 and 1.4 of this report, the recent relatively high increase in the population of areas closest to Canberra is consistent with historic trends, and with trends occurring in other areas close to major cities elsewhere in Australia. Impact of the ACT on housing markets in surrounding NSW Population increases will generate a demand for additional housing, and also increase the price of established housing in areas where population growth is occurring. The relatively large population growth and employment concentration in the ACT, has implications for housing demand and supply not just within the ACT, but also in surrounding areas of NSW. The ‘housing market’ that is relevant for people who live or work in the ACT is not restricted to dwellings physically located in the ACT, but also includes dwellings within commuting distance in surrounding areas of NSW. The most significant impact of the ACT on housing demand and supply in NSW, occurs in those areas closest to the ACT. Demand for housing in LGAs close to the ACT is also likely to be impacted not just by access to employment in the ACT, but also by relatively easy access to the ACT’s health services, educational establishments, recreation, business and shopping opportunities. As can be seen in the following table, the percentage increase in the number of occupied private dwellings over the period 2001-2011 was actually greater in the LGAs of Queanbeyan, Yass Valley and 1 ABS Regional Population Growth, Australia, 2013-14, Cat. No. 3218.0, released 31/03/2015. Canberra’s Influence on the Surrounding NSW Economic and Housing Markets 1 Palerang than it was in the ACT, although the greatest overall increase in the number of occupied dwellings still occurred in the ACT. Occupied Private Dwellings ACT Queanbeyan Yass Valley Palerang % in ACT 2001 114,839 12,468 4,202 3,792 85% 2006 122,899 13,999 4,833 4,539 84% 2011 135,034 14,895 5,429 5,205 84% Increase 20,195 2,427 1,227 1,413 79.9% 2001-2011 % Increase 17.6% 19.5% 29.2% 37.3% 2001-2011 Source: ABS Census 2001, 2006, 2011. The price of housing is impacted by distance from employment concentrations and other attractions in city centres.