Before resigning as Victorian Premier last year, Daniel Andrews announced a fantastical target to build 800,000 homes across the state over a decade, equating to 80,000 homes annually.
As illustrated in the next chart, the most homes Victoria has ever built in a single 12-month period was 69,972 homes in the year to September 2017:
Therefore, the 80,000 target would require a volume of homes that has never before been achieved.
Jeroen Weimar, the senior bureaucrat responsible for implementing the government’s housing agenda, warned over the weekend that failure to meet the state government’s 800,000 housing target is not an option because Melbourne is projected to balloon to more than 8 million people in only 25 years.
“This place is going to look fundamentally different in 25 years’ time”, Weimar told The Age.
“Melbourne will be the size of London from a population point of view – a city of over 8 million people. The state will have over 10 million people in it, and as such we can’t think about housing incrementally”.
“If we are going to accommodate the growth that we want to see…, then we need to create more housing capacity in our system”.
Who wants to see such population growth? Certainly not the majority of Melburnians.
The Age provided a realistic assessment of Victoria’s hopeless housing challenge:
“The problem is, by 2051 the state’s population is expected to swell by half to 10.3 million, up from about 6.8 million”…
“To ease what the housing statement described as the “acute pressure”, Victoria would need to deliver 2.24 million homes by 2051, or an average of about 83,000 homes a year for the next 27 years. Hence, the target to build 800,000 new homes within the next decade”.
“Put another way, seven out of every 10 new houses delivered in the government’s plan would be needed just to soak up expected population growth”.
Scepticism surrounding the Victorian government’s housing targets abounds amid the prefect storm of higher interest rates, soaring construction costs, labour shortages, and general supply chain disruptions from the pandemic.
Maxwell Shifman, chief executive of development group Intrapac Property, told The Age that the housing target has “zero chance” of being met.
“Housing completions, approvals and starts are all well down on the numbers that they need”, he says.
“It is becoming impossible to build apartments in Victoria deemed to be affordable”.
“The development industry can no longer deliver something that meets affordability criteria … because of the cost involved”.
Marcus Spiller, principal and partner of SGS Economics & Planning, also told The Age that Melbourne was one of the fastest growing cities in the developed world. And just because more housing is zoned doesn’t mean it will be built.
“We shouldn’t be under an illusion that just because we zone for more housing the developers will come”, he said.
“The problem that we are facing now … isn’t the planning, it is more the adverse economics of development. It is very difficult for developers to make projects stack up unless they are at the really premium end of things”.
Planning Institute of Australia Victorian president Patrick Fensham also warned that significantly higher densities will require extra infrastructure and services to cater for the ballooning populations. Otherwise, liveability will be further eroded.
“If you are identifying where you are going to have higher-density development, and sometimes significantly higher-density development, you need to be provided with accompanying global infrastructure and local public domain and local public open space to accommodate the growth”, Fensham said.
Let’s get real for a moment. The 50% increase in Melbourne’s population this century has already degraded our quality of life.
It took Melbourne around 170 years to reach a population of 3.5 million people at the turn of the century.
Under the state government’s own population projections, Melbourne will hit 9.0 million people by 2056:
If those population projections come to fruition, it would mean that Melbourne’s population would grow by an extraordinary 5.5 million people (~160%) in only 56 years.
No amount of construction could ever keep pace with this level of population growth.
Melbourne would forever fall short of housing and infrastructure.
Instead of proceeding down this path of a high-rise slum future, the Victorian should instead lobby the federal government to reduce net overseas migration to a level below the nation’s capacity to supply housing and infrastructure.
Sadly, Victorian Premier has instead embarked on a taxpayer-funded junket to India to grovel for more Indian students and migrants.
The Victorian Labor government will do whatever it can to force-feed Melbourne to 9 million people by 2056, regardless of the deleterious consequences on living standards.
