This version of the HOUSING fact sheet, May 2012 has been prepared for use with screen reader software.
The PDF version also available at www.planmelbourne.vic.gov.au is recommended for general access
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HOUSING FACT SHEET
INTRODUCTION
As the population grows and changes, so do the demands for new and diverse types of housing. Over the next
30-40 years we can expect Melbourne’s outward growth will reach the edge of its current boundary. One of the
issues facing Melbourne is not only how many houses we build, but how we ensure enough housing choice in a
range of locations.
HOUSING TODAY
The houses we live in and where they are located influence many aspects of our lives - how long we spend
travelling to work, where our children go to school and how we socialise within our community. In Victoria, new
housing is primarily provided through the private market. The role of the planning system is to provide the vision
for where new housing will be built, and to regulate and support development to meet community needs.
Currently there are around 1.6 million homes in Melbourne.
Graphic: Projected changes over the next 30-40 years in the proportion of household types
Source: Victoria in Future 2012
DID YOU KNOW?
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New housing adds around two percent to the total number of homes in Melbourne each year.
Around 320,000 first home buyers entered the market between 2000-2011.
Over 75 percent of first home buyers bought existing homes.
Between 2004-2009 there were around 132,000 homes added to Melbourne.
In 2006, over 73 percent of Melbourne’s households owned or were buying their home, 23 percent lived
in a private rental home, and more than three percent lived in social housing.
Growth areas have attracted around half a million people over the past 20 years.
HOUSING TOMORROW
Here are some key facts about housing and the changes government, businesses and the community need to
consider.
HOUSEHOLDS ARE GROWING AND CHANGING
Melbourne’s population is growing and changing. This means the need for additional and more diverse housing
will continue.
Over the next 30-40 years, it is estimated that Melbourne may require about one million more homes to meet the
housing needs from population increase and from fewer people living in each home.
Homes comprising families with children are expected to continue to grow, but account for a smaller proportion of
Melbourne’s total households.
Based on current trends, over the next 30-40 years the proportion of homes comprising families with children is
expected to decrease, while the proportion of one-person and couple only households is expected to increase.
At the same time, the type of housing people prefer is also changing. These changing preferences and
household sizes mean Melbourne will require more diverse housing types, including medium and higher density
housing close to infrastructure and in areas where people wish to live.
AFFORDABLE OPTIONS
Housing has become increasingly expensive in Melbourne over recent years. Since 2000 the median house
price has almost tripled, increasing from $190,000 to $500,000 in 2011.
During the same period the average wage in Victoria has also increased from around $42,500 in 2000 to
$66,500 in 2011. However the proportion of income spent on mortgage repayments has increased for some
households.
A similar pattern of affordability is affecting rental housing. Since 2000, the median weekly rent for a three
bedroom home in Melbourne has increased from $190 per week to $340. This increase has been greater than
the increase in incomes for low income households. In June 2011, the percentage of rental properties in
Melbourne affordable to people on Centrelink incomes has declined to less than ten percent of all rentals.
Affordable opportunities for low to moderate income first home buyers and renters have become increasingly
limited to Melbourne’s outer suburbs.
High costs in the residential construction sector also contribute to housing affordability challenges. Between 2001
and 2011, construction industry prices for new-dwelling construction rose by 54 percent, 28 percentage points
above the increase in the average for all industries. Costs are disproportionately high for residential construction
over three storeys. This influences people’s choices about housing type and location.
Graphic: Average weekly rent for a three bedroom home
Source: ABS Consumer Price Index Australia 2011
HOUSING APPROVALS
In 2011 there were around 40,440 houses approved to be built in Melbourne. This is nearly twice as many as
Sydney which had 22,230 housing approvals. Over 22,000 of Melbourne’s housing approvals were for detached
houses and over 18,400 were for other housing types such as apartments, townhouses or units. Nearly one third
of all approvals were in growth area councils.
HOUSING CONSTRUCTION
New housing adds around two percent to the total number of homes in Melbourne each year and most people
buy and sell existing homes. Between 2004-2009 there were around 132,000 homes added to Melbourne’s
housing stock, with the largest amount of construction activity occurring in 2009.
TYPES OF HOUSES
There have been a number of housing types built in Melbourne, ranging from higher density apartments, mainly
in inner locations, to smaller scale unit developments and detached homes more common in the middle and
outer suburbs. Between 2004-2008 around 70 percent of homes built in the established areas were detached
houses, villas or townhouses. The remaining 30 percent were apartments or units.
FIRST HOME BUYERS
While housing has become increasingly expensive in Melbourne over recent years, first home buyers are still
entering the market at similar numbers to the long term average. In Melbourne around 320,000 first home buyers
entered the housing market between 2000-2011. Nearly 25 percent of first home buyers purchased a new
home, mostly in the growth areas. Over 75 percent of first home buyers purchased an existing home and the
vast majority of these were in the middle and outer suburbs.
HAVE YOUR SAY
We are seeking your thoughts and ideas on Melbourne’s future. Join our online forums to discuss:
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What types of homes would you like to see more of?
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What do you think the priority should be when planning for more diverse and affordable homes?
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Twitter is #planmelbourne
Internet website is www.planmelbourne.vic.gov.au
Email to planmelbourne@dpcd.vic.gov.au
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