Rising house prices and rents, low wage growth, taxation settings and limited investment in social and affordable housing have all contributed to a significant decline in housing affordability. This environment has led to an increase in the number of households experiencing housing stress in the community.

In response, Monash City Council has developed an Affordable Housing Strategy.

The Strategy makes a clear case for taking action for greater affordable housing provision in Monash. It demonstrates both the need for affordable housing and the benefits of having more affordable housing to the community and the economy of Monash.

In seeking to address the “need” for affordable housing it is necessary to tackle the issue from both a supply and demand point of view. This means that the Strategy and Actions are targeted to both increase the amount of affordable housing available and, in the longer term, reduce demand for affordable housing through actions that work towards increasing housing affordability.

Objective

The objective of the Draft Monash Affordable Housing Strategy is to:

“Identify a clear and practical set of strategies and actions for Monash City Council to support increased housing affordability and supply of affordable housing, within its remit as a local government authority.”

What are the benefits of affordable housing?

The benefits will not only go to the people who live in the housing, but also benefit the wider community.

Research into the impacts of increased social and affordable housing supply identifies the following key benefits:

• Reduced disadvantage through lower rates of housing stress and reduced risk of homelessness
• Improved diversity by creating the opportunity for people with any income level to live and work in the community
• Enabling residents to stay in their local area through different life stages and maintain strong social and community networks
• Economic efficiency by ensuring that high housing costs do not exclude valuable members of the labour force from good access to jobs in the City of Monash
• Reduced housing costs which enable greater expenditure to be directed into productive areas of the economy
• Reduced demand for government and not-for-profit assistance for housing
• Reduced movement and congestion costs associated with living distant from employment or services.

What is the scale of the current need for affordable housing in Monash?

The need for social and affordable housing in Monash can be demonstrated by how many households are experiencing housing stress.

In 2019, there was an estimated 1,470 people experiencing homelessness in Monash.

In Monash, there were a total of 9,400 households in need of household assistance in 2021. This represents almost 1 in every 8 households (12.3 per cent).

Of the households in housing stress in 2021, lone person households account for the largest group of over 4,000 households. This is followed by couples without children and single parent families.

There are fewer group households in housing stress because they make up a smaller portion of all Monash households. However after lone person households they are among the most likely household type to experience housing stress – 24 per cent of lone person households, 22 per cent of group households and 18 per cent of one-parent families experience housing stress.

More than half of all households in housing stress are very-low-income households.

Around half of households in rental stress are experiencing severe housing stress, paying more than 50 per cent of their income on rent.

Overview of households in Monash (2021)

Affordable housing can help a diverse range of households live and work in Monash

The tables below provide a snapshot of the households that can be affected by housing stress due to housing unaffordability.

Source: sgsep.com.au

Many very-low income earners are part-time and casual workers

Examples and typical annual income:

• Cafe workers $22,000
• Aged pensioners $22,000
• Checkout operators $23,000

Minimum wage $37,500

Examples and typical annual income:

• Commercial cleaners $28,000 + delivery drivers $40,000 = $68,000
• Music professionals $32,000
• Child carers $34,000

Examples and typical annual income:

• Handypersons $48,000 + Occupational therapist $46,000 = $94,000
• Counsellors $58,000
• Chefs $52,000

Future demand for affordable housing in Monash

The need for affordable housing is likely to increase as Melbourne’s population grows. In Monash, there were a total of 9,400 households in need of household assistance in 2021, and this is forecast to grow by 3,100 households to 12,500 households by 2041.