It won’t come as a surprise to most Australian’s that the most expensive electorate in Australia to buy a house is Sydney’s Wentworth. Home to some of Australia’s wealthiest suburbs including Point Piper, Bellevue Hill, Vaucluse, Double Bay and Dover Heights, the median house price in the seat of Wentworth is slightly higher than $1.65 million.
It’s the highest median house price of any electorate in Australia and the marginal Liberal seat is held by Malcolm Turnbull with a margin of just 3.9%. The most affordable suburb in Australia’s most expensive electorate is Woolloomooloo where the median house price is $782,500. Such a high priced ‘entry point’ to the electorate would suggest this is a fairly safe liberal seat, however that is not the case.
At the other end of the spectrum is the safe Labor seat of Lalor, which wraps around the outer western fringes of metropolitan Melbourne. The electorate of Lalor, with a median house price of $300,000, is the most affordable metropolitan electorate in Australia based on median house prices. It’s also Julia Gillard’s, electorate and one of the safest Labour seats with a margin of 15.5%. The most expensive suburb in the Lalor electorate is Werribee South which has a median house price of $425,000. The most affordable suburb in Lalor is Melton with a median house price of just $225,000. Based on Census data, Lalor shows a strong bias towards blue and grey collar workers earning slightly higher than average wages. At the time of the most recent Census almost half the homes in the electorate were under mortgage and more than three quarters of households were characterised as family homes. Prime mortgage belt territory where the scale of mortgage repayments is likely to be one of the most pressing issues.
The polarity of these two electorates demonstrates the enormous gap that exists between housing markets around Australia and the challenges that Australian policy makers (and prospective policy makers) have when addressing issues like housing affordability and social housing initiatives.
As analysts of housing markets around Australia, it is surprising to see that housing policy initiatives play what seems to be an insignificant role in the current election campaign.
Despite housing costs and supply being one of the most topical and pressing issues facing Australians, it seems as if the major parties have mutually agreed to place the issue in the ‘too hard basket’.
The National Housing Supply Council has estimated that there is close to 180,000 too few homes across Australia. This figure is projected to increase to about 308,000 by 2014. Housing affordability continues to be a pressing issue across many parts of Australia’s cities and regions from both a purchase and rental perspective. Schemes such as the Home Savers Accounts and National Rental Affordability Scheme have been largely unsuccessful, with just 15,300 Australians signing up for the ‘Saver’ accounts compared to a budgeted 750,000. Meanwhile the National Rental Affordability Scheme (NRAS) has experienced delays and low levels of take up. To top it off a large chunk of the funds originally designated to help combat rental affordability (together with funds from the Housing Affordability Fund) will be redirected to help fund a boost to regional housing assistance under a Labor Government.
Housing pressures and affordability pains are likely to be felt in the outer metropolitan markets. Despite housing being cheaper than homes located closer to the city, the demographics of these regions often reflect a high proportion of first home buyers and low income families. These are also the areas where policies targeting peripheral housing issues such as land release strategies, infrastructure development and improved public transport are sadly not being addressed.
It stands to reason that policies aimed at alleviating mortgage pressures and improving livability in the outer fringes would be a welcome campaign pitch throughout many electorates around Australia. Polices targeting a higher level of strategy around land releases and higher density zoning of land closer to the city, further stamp duty concessions for first home buyers and low income families and improved public and private transport options linking the outskirts of major metro markets are prime examples of where our political parties have failed to address the housing issues.
Tim Lawless is the Director of Property Research at RP Data.
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