New report examines housing programs in regional and rural Australia

REGIONAL and rural centres have not been immune from Australia's current housing crisis, with national housing programs and policies having a variable and often muted level of impact in rural and regional housing markets, according to a new study.

The study, investigating the drivers of supply and demand for housing in regional and rural centres and their impacts on the supply of affordable housing, also finds that there has been a lack of analysis of the impact of affordability and housing supply and demand in regional markets.

With regional markets also affected by the same house price boom and subsequent affordability issues that have occurred within urban housing markets, the study examines housing market drivers in regional and rural centres, the nature and extent of housing affordability problems in these regions, and the likely impacts of housing policies and programs being implemented by governments in Australia.

The study finds that regional and rural centres have been affected by rapid house price inflation since the year 2000, with many regional housing markets also affected by Australia's resources boom, which has resulted in "bifurcated housing markets."

This bifurcated housing market consists of a market focused on high income, and often temporary, mine workers, while a second market exists for the "established population working in ancillary industries or not working at all, competing for less expensive properties at the bottom end of the housing market."

A significant gap between the home ownership sector and rental accommodation is identified in the report, with "clear evidence of market failure in the rental market and widespread concern among a broad range of stakeholders about the ability of low income earners to access affordable rental housing and transition from rental into home ownership in the short and longer term."

Due to a combination of factors, including a shortage of investors and inappropriate planning regulations, the report finds that the private rental market "appears undeveloped or under-developed", while social housing provision is said to be inadequate.

To enhance the effectiveness of housing programs, the report outlines a number of steps for government, including:

  • The geography of housing affordability and unaffordability is highly variable and must be taken into account in policy responses for addressing affordability problems;
  • Collecting timely statistics on housing need and housing conditions generally in rural and regional areas;
  • Improved promotion and targeting of initiatives to rural and regional centres, with many local government officers interviewed for the study unaware of either the Housing Affordability Fund (HAF) or the National Rental Affordability Scheme (NRAS);
  • Targeting some programs to rural and regional centres;
  • Increasing the supply of housing for Indigenous Australians by maintaining a commitment to the long-term supply of appropriate housing and the maintenance of such housing;
  • Matching the provision of infrastructure in rural and regional centres to the supply of additional land for housing; and
  • Addressing planning issues, such as infrastructure costs and charges, minimum lot size requirements and capacity constraints within regional planning authorities.

The report, titled 'The drivers of supply and demand in Australia's rural and regional centres', was authored by Andrew Beer and Selina Tually of the University of Adelaide; Steven Rowley, Fiona Haslam McKenzie, Christina Birdsall-Jones and Vanessa Counna of Curtin University; and Julia Schlapp of RMIT University.

The report was published by the Australian Housing and Urban Research Institute (AHURI) and is available from the AHURI website at <http://www.ahuri.edu.au/>.

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