Victorian Greens say 30% of homes in new developments should be cheaper for first-time buyers

A plan to build 200,000 affordable and public homes will be at the heart of the Victorian Greens election campaign, with its leader, Samantha Ratnam, claiming major parties have “given up” on addressing the housing crisis due to their relationships with developers.

The party will on Saturday launch its election platform, proposing the reintroduction of a social housing levy on property developers and a requirement that 30% of homes in large developments are set aside for first-home owners.

“For too long we’ve seen the major parties throw their hands up in the air, saying ‘it’s all too hard’ when it comes to creating the reforms that are necessary to address the growing housing crisis,” Ratnam told Guardian Australia.

“They’re tired, they’ve given up on the big, courageous ideas that are needed to help shape the future for the better.”

She said despite the Labor government’s $5.3bn “Big Build” of 12,000 social and affordable homes, demand continues to outstrip supply. Victoria’s public housing waitlist has also ballooned to more than 120,000 people.

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Young people have altogether abandoned the Australian dream of owning their home, Ratnam said, disagreeing with the view of the premier, Daniel Andrews, that home ownership was less important to younger generations.

“Growing inequality is the main issue young people are speaking to us about, how they’re being left behind when it comes to housing affordability,” she said.

“It’s not that they don’t want to own a home, they just don’t think it will ever be possible.”

Under the Greens plan, developers will be required to allocate 30% of homes in developments of 50 or more dwellings to first-home owners, with prices set at 80% of the market rate.

Ratnam said under the plan major housing developments won’t be approved unless affordable homes are included in their projects.

The proposal is estimated to create about 100,000 affordable homes in 20 years and is similar to planning controls used in other major cities, including in New York City, where 20-30% of homes in designated developments need to be affordable for an area’s median income.

In South Australia, major developments in designated affordable housing zones are required to provide 15% affordable housing.

To help fund the construction of an additional 100,000 public homes, the Greens are seeking the re-introduction of a social housing levy on developers, which the government announced – and then withdrew – in February.

The government’s levy would have raised about $800m to pay for up to 1,700 new social and affordable homes each year by charging developers 1.75% of the expected project value on new subdivisions or developments with three or more dwellings.

In exchange, reforms to Victoria’s planning system were offered to developers to speed up planning approvals and boost profits. But the government walked away from the plan within five days, in part to avoid a scare campaign ahead of the November election.

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The Greens’ proposed social housing levy is at a higher rate of 2.5% for developments of three or more, but excludes large developments that would be required to set aside homes for first-home owners. It is expected to raise $2bn over the next decade.

Ratnam claims the government walked away from the social housing levy due to their “close relationship” with developers: “It was one small glimmer of hope, trashed within days.”

“The public are starting to see how special interests and influence and donation relationships start to impact on the ambition of these major parties,” she said.

The party also proposes a tax on big banks, set at 0.015% of Victoria’s share of bank liabilities. Costings by the independent Parliamentary Budget Office shows the tax would raise about $1.4bn over the next four years.

Ratnam expects the party will build on the momentum of the federal election and can pick up the seats of Albert Park, Northcote and Richmond, and at least double its representation in the upper house.