Policies and initiatives > Direction 6. A fairer city > Policy 6.1

Policy 6.1 – Increase the supply of well-located affordable housing

In recent years, the housing market has become more complex in its structure, composition and geography. Property values have risen steadily with the average increase across the metropolitan area between 1996 and 2001 being 42 per cent. In some suburbs property values have risen spectacularly, for example, North Melbourne rose 212 per cent, Croydon North 145 per cent, Sorrento 136 per cent and Maribyrnong 127 per cent in the same time period. Affording good, well-located housing has become an acute problem for many private renters and home buyers.

There is growing spatial polarisation, with inner suburbs tending to represent high-priced market segments and outer suburbs lower-priced segments. Affordable, low-cost private rental housing is in decline in inner Melbourne and accessibility to services in lower-cost rental areas is unsatisfactory. This accentuates the polarisation of the city and generates areas of social disadvantage.

The existing distribution of public housing does not match changing housing needs, especially the need for a wider range of housing options in the middle and outer suburbs. Strategies for public housing estates are being developed to reduce concentrations of public housing and overcome social and economic disadvantage. Public and community housing stock is not increasing in step with demand. Increasingly, public housing is targeted to households with multiple needs, rather than to those who simply cannot afford private rental accommodation.

Better information about mismatches between supply of, and demand for, affordable housing will be required for different households and locations. The supply of affordable housing in all parts of the metropolitan area will need to be increased.

It is recognised that this need exists, and that the planning system alone is not well equipped to meet it. A significant proportion of new development, including new development at activity centres and strategic redevelopment sites, must be affordable for households on low to moderate incomes, especially those that are experiencing housing stress but are unlikely to gain access to public or social housing. Ways of achieving this will be explored. The monitoring of housing affordability will be important in finalising eligibility criteria for these dwellings.

These measures will involve a number of agencies working closely together to maximise every opportunity to increase the supply of affordable housing and meet household needs.

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