Whether we want it or not, the SRL seems to be happening. But it will cost tens of billions of dollars we don’t have. So, where will it come from? The State Government hopes to get some of the money from the Federal Government, but this relies on being able to make an economic case to justify it. Such evidence appears to be scant but given that both State and Federal Governments are of the same persuasion, a deal will likely be done before the next election.
So, whether this appears to be madness, or you are in full support, we need to look over the horizon and consider the probable impact. There is enough evidence of the current thinking and the prevailing politics, to have a good idea on where things are headed.
There is only so much additional debt the government can take on before our credit rating starts to crash. So, the first thing the State Government has full control over is planning; the second is taxation. Philosophically, there has been no hesitation in using division, and “haves” and “have nots”, to gain both political advantage and to justify additional taxation.
This leads us to conclude that the announced intention to build more dwellings near the SRL stations, along with a zoning radius of 3 kilometres from each one, will result in the rezoning of entire suburban blocks. As this is to encourage higher density, the height limits will change dramatically. Look at Box Hill, Doncaster, Glen Waverley or Ringwood to get the idea of what is envisaged. This will make some properties more valuable. And every affected property will be taxed accordingly, on land tax and council rates and almost certainly for windfall gains of up to 62.5% on the increase in value when they sell (but accruing interest from the time of the rezoning – see sro.vic.gov.au). Existing residentially zoned property is currently exempt; however it seems obvious that this is about to change to ensure a contribution to the cost of this project.
For those who don’t want to sell, well they will simply have the privilege of paying a lot more in taxes and interest on the notional tax due. And the sting in the tail? All those in the immediate proximity but without the rezoning will suffer the development, traffic and increased density, without any compensation whatsoever. Unless the new station is sufficient compensation for them?
All local property owners will be affected. But uncertainty about how much will prevail for quite some time yet. Possibly until the next election.