CAPITAL GROWTH RESTRAINED PROPERTY TITLE (CGRPT)
Currently, pricing for new housing developments created under the standard free market model are managed to achieve the maximum market price for an area plus design inducements towards a higher price. This steady uplift of housing prices applies pressure to rental rates and political pressure on a State's social housing asset holdings "return on investment". Average house prices in Australia and New Zealand have elevated to a level that exceeds single income affordability for over 90% of prospective home buyers.
The CGRPT concept is a cost efficient and permanent answer to the increasing market cost of houses for "beginner" home owners in our inflated housing market. The CGRPT concept will achieve an ever expanding supply of more affordable houses, houses that are 50% and more cheaper than other houses in any area, that thereafter stay as affordable as they were at the time of their construction and release to the public.
This is achieved because the capital growth of assets stated on a CGRPT property title are linked to the accrued Consumer Price Index (CPI) and such properties appreciate in value at that rate only. In this way a CGRPT property value is permanently linked to income purchasing power at the same level.
How is it possible to build houses at a much lower cost in the first place?
Under the free market housing model it is impossible for houses to be built for sale at their construction cost, as, at the first re-sale, property prices are drawn up to the market price. Any benefits in the form of lower land cost, first home buyer grants, or foregone speculator's margins are "cashed up" at the time of a re-sale and benevolence is not passed on to future buyers.
Under the CGRPT concept benevolence is preserved in the property title allowing agencies to provide land and buildings at a lower cost confident that this is a benefit to all future owners of such properties. Agencies both public and private can invest in affordable housing knowing that as CGRPT titles their efforts are permanent, and properties can be developed to be affordable for all community income levels.