Housing: Apartments

Growth Areas Bad, Infill Good: Planning’s Perennial Problem

Posted on by Quantify

As one of the least affordable housing markets on the globe, Australia’s worsening housing crisis seems to be of little concern to many, who are instead more interested in maintaining a relentless and increasingly tiresome attack on greenfield development. If, as a nation, we are genuine about improving the dire state of housing, then the “growth areas bad, infill good”, mindset, simply needs to stop.

Relative to its established suburbs, Melbourne’s growth areas have more than delivered on their end of the bargain during a decade of unprecedented population growth.

Accommodating vast numbers of people, including many recent migrants who are now arriving in record levels, growth areas have, and continue to serve a basic, societal function at a scale not happening elsewhere: housing the population. In the absence of a considered national population policy, this pattern will continue, whether we like it or not.

Contrary to the perception that greenfield development is little more than low-density, McMansion- riddled sprawl, housing our own version of “Deplorables”, Melbourne’s growth areas are being developed at densities higher than the majority of its established suburbs.

Year after year, the number of new dwellings required in established suburbs, simply fail to be delivered. Despite policy objectives, this is in no small part the result of political folly, sadly coming at the expense of much-needed housing. Across metropolitan Melbourne, there are thousands of well-located Neighbourhood Residential Zoned sites that also happen to be situated within 400 metres of the Principal Public Transport Network (PPTN). How this self-induced dilemma reconciles the protection of neighbourhood character with the objectives of the 20 Minute City will be intriguing to say the least.

Ironically, ineffective infill policy has placed an even greater burden on Melbourne’s growth areas. Providing approximately two-thirds of all new dwellings, the combination of population increase, demographic shifts, and the need for affordable housing, is likely to generate even greater demand for housing in growth areas over the coming years.

Planning for rapid growth is a dynamic process that is reliant on a sophisticated understanding of a range of variables. So long as the system is characterised by ineffective policy, outdated land-use strategies, and an ideological disdain for greenfield development, the housing crisis is here to stay.

Net Overseas Migration Roaring Back

Posted on by Quantify

Interesting results from the September quarter 2022 population release published today by the Australian Bureau of Statistics.

  • Australia experienced a record quarterly net overseas migration (NOM) inflow of 106,200, only the second time quarterly NOM has exceeded 100,000 (after March quarter 2022). NOM for year to September 2022 was 303,700, just shy of the record 315,700 annual NOM in 2008.
  • Based on recent monthly arrivals and departures, as well as student visas granted, national NOM should easily surpass 350,000 in FY2023, and could even reach the 400,000 flagged by Westpac a couple of weeks ago. Victoria and New South Wales are attracting around two thirds of this total.
  • Interstate movements in September quarter 2022 were very low (73,600 persons), having been lower only twice in the past 20 years. This could be a hangover from the record interstate movement induced by the COVID pandemic and/or that lack of options for interstate migrants due to extremely low vacancy rates. Queensland, Western Australia and South Australia remain destination states, although Victoria’s recent high net interstate outflow fell to almost zero in the quarter and could move back into positive territory in December 2022 quarter.
  • Births registered in September quarter 2022 continued the lower level that emerged after the post-COVID bounce seen in calendar 2021. It will be interesting to see whether cost of living pressures will see births take another step down over the next year or two.
  • Deaths remain above the five year average, reflecting the trends already seen in the more current provisional data published by the ABS. In 2022, there were 174,717 deaths that occurred by 30 November and were registered by 31 January 2023. This was 22,886 deaths (15.1%) more than the baseline average. The higher deaths could play out for some time due to the limited preventative care that is likely to have taken place through COVID lockdowns.

Annual population growth (418,500) is now at its highest level since 2008-2009 and is on track to end at a new record in FY2023. The consequences of a turbo-charged population are evident in rental markets, which will tighten further in the absence of growth in new dwelling supply. Rising rents will contribute to inflationary pressures as will the increased demand for goods and services. Although adding to the overall labour pool, shortages for particular skills may be exacerbated if the lack of rental stock reduces worker mobility and restricts the ability for workers to move where there is demand.

Notably, the most recent ABS release highlights that the current publicly available population projections are now significantly undercooking population growth over the next couple of years. For further insight into what this means for population growth nationally and across the states, contact Angie Zigomanis at angie.zigomanis@quantifysi.com.au or Rob Burgess at rob.burgess@quantifysi.com.au