This research paper highlights the growing gulf between housing prices and buyer purchasing capacity in Melbourne.
Snapshot
Moderate income earners in Victoria will face are facing growing challenges without significant reform to address the underlying cost of housing.
In-depth greenfield analysis over FY23 and into FY24 shows that there are no conventional house and land packages that meet the budgets of very low and low income households. This has been seen in Metro Melbourne and Regional Victoria’s housing estates across Geelong, Ballarat, Bendigo, Warragul and Drouin.
In fact, there has been a consistent deterioration in the availability of affordable housing for moderate income earners.
Households in Metro Melbourne with a moderate income only had access to 49 per cent of the house and land product that sold in FY24. Only 14 per cent of house and land packages sold were suitable and affordable to couples with two children on a moderate income.
UDIA Victoria research shows a significant reduction in buyer capacity of up to $300,000 for the average Victorian couple, and a rise in the median house price in Melbourne to nearly $1 million. The market is suffering from a lack of supply across-the-board, with demand in the growth areas (27.5 years zoned and unzoned) far outstrips incoming supply (13 years).
