Australia - housing in Melbourne

'Our way of life destroyed'

Most homes fail affordability test for households on median income

the Age,

26 October, 2012

MOST Melbourne homes are too expensive for households on a median income, and only a handful of suburbs - mostly on the city's fringe - pass the affordability test, a government report reveals.

The report shows households earning the city's median annual income of $70,300 have few suburbs to choose from. Even the cheapest suburbs require an annual household income of between $67,000 and $90,000 to pay the mortgage and other bills.

Up until now Matthew Guy's plan has been to create a concrete jungle, making Melbourne a less attractive place to invest by destroying our envied way of life.

In many inner Melbourne suburbs - which have better access to public transport and services - a household requires an income of between $120,000-$200,000 a year.

The state government report, Melbourne, let's talk about the future, predicts Melbourne will need an extra million homes in the next 30 to 40 years as the population increases to more than 6 million.

The need for more homes will be compounded by an ageing population as the number of people over 65 is expected to double in the next 20 years and the percentage of households that have children declines.

Many of these new homes could be built around the CBD, with plans for almost 250,000 more homes stretching from Carlton to Fishermans Bend.

The report is a discussion paper encouraging public feedback on how Melbourne should be planned and developed over the coming decades. The Baillieu government is expected to release its long-term blueprint for Melbourne next year in place of the Melbourne 2030 planning statement.

The full discussion paper will be released today.

The section made available to The Age raises tough questions, including how Victoria will pay for the next-generation transport network.

''There is a clear desire to identify a comprehensive vision for the transport system, in a similar way to how the road plans in the 1960s identified a long-term vision. However, we can't keep funding the way we have been and we need to explore new approaches,'' the report notes.

It says new funding options could include a broad-based metropolitan improvement levy, user-pays tolls and asset sales.

The report includes community attitudes to the different funding models, with strongest support for government bonds and private sector partnerships and least support for new tolls and raising taxes.

Planning Minister Matthew Guy said the government wanted a community discussion on what was the best funding measure for new facilities.

The report also identifies the need to increase job options in Melbourne's growth areas so fewer people are compelled to drive long distances to work.

''The key issue is that a large proportion of people use their car to access employment. Even short trips under one kilometre in the outer suburbs are made by car,'' it says. ''Around 90 per cent of people in the outer areas and 40 per cent of people in the inner areas drive to work.''

Long journeys were leading people to choose less-skilled jobs.

A recent study found the separation of residential areas from areas of employment meant some residents took lower-skilled jobs closer to home in order to meet the family's responsibilities. This particularly affected highly educated and skilled women, the report notes.

The state opposition criticised the discussion paper, arguing the Baillieu government was already undertaking major changes to Victoria's planning system before it had a clear vision for Melbourne's growth.

''Up until now Matthew Guy's plan has been to create a concrete jungle, making Melbourne a less attractive place to invest by destroying our envied way of life,'' opposition planning spokesman Brian Tee said.

Public feedback on the planning discussion paper closes on March 1.