Melbourne suburbs that boast the most amenities – but lack one type of home

Some of Melbourne’s highest-amenity neighbourhoods in the inner city and south-east are lagging behind other areas in the provision of social housing, new research shows.

In Melbourne’s CBD, parts of South Yarra, Southbank, Toorak and Docklands – rich in local services such as public transport, schools, medical services, employment opportunities and leisure activities – public housing makes up 1.4 per cent or less of the suburbs’ overall housing stock.

The report, published by the Australian Housing and Urban Research Institute, used data from crowdsourced platform OpenStreetMap to map neighbourhoods’ access to local amenities and services and then compared it with the local social housing stock.

Their findings show that 70 per cent or more of high-amenity neighbourhoods in four states – NSW, Victoria, Western Australia and Queensland – had less than 5 per cent social housing, the minimum threshold the researchers believe would help address housing affordability and reduce poverty and inequality.

Lead author Dr Stephen Glackin, Swinburne University’s expert in urban planning and geography, said that while social dwellings were growing in number, since the 1990s “they have been dropping hugely in terms of market share”.

“This means that the number of social houses is going up, but private houses are going up substantially more and much quicker,” he said. In Victoria, social housing declined from 3.5 per cent of all households in 2014 to 2.8 per cent in 2023.

While Victoria has committed to building 12,000 social and affordable homes, Glackin said most of these would be “on the periphery of the city”.

“I was very surprised that Melbourne is increasing [social housing] stock in greenfield areas, where there is very little amenities,” he said. “We also noticed that every city is getting rid of detached housing to build high-density housing, except for Melbourne … which is selling off its medium stock rather than low density.”

He suspects the rationale is economic, as inner and south-eastern suburbs are among Melbourne’s most expensive. “You’re always going to get backlash to significant volume of housing, especially in these kinds of areas,” Glackin said.

Not all high-amenity inner-city neighbourhoods are bereft of social housing. Flemington in the inner north-west has the highest proportion, at 15.6 per cent, while the inner north’s Fitzroy (13.2 per cent), Collingwood (12.9 per cent), Kensington (9.5 per cent) and North Melbourne (9.2 per cent) are above average. Although the northern end of South Yarra has a low proportion of social housing, the south end has 8.5 per cent.

Maiy Azize, spokesperson for Everybody’s Home, said these inner suburbs now lacking in social housing were once filled with it, but they became so valuable that the state government “sold the lot and commissioned other social housing further away”.

“It’s very fraught now… [because they are so affluent] it’s now going to be hard to get social housing back into these areas without a lot of local objections,” she said. “It’s also financially much harder to build new social housing in established suburbs … we’ve created a lot of unnecessary obstacles for ourselves.”

Low-amenity neighbourhoods with high proportions of social housing include Meadow Heights (7.3 per cent) and Corio-Lovely Banks in Geelong (7.6 per cent).

Sarah Toohey, chief executive of Community Housing Industry Association Victoria, said that while high-amenity areas came with high land costs, which made social housing difficult to build, failing to deliver it in prime locations carried a high social and economic cost.

“Building social and affordable housing in well-serviced areas just makes sense,” she said. “Residents deserve to be close to services and jobs, and communities rely on these residents to keep our city thriving.”

In a recent submission to Victoria’s planning provisions, Grattan Institute’s housing economists said reforming zoning regulations was key to building more medium density housing in Melbourne’s established, well-serviced suburbs.

Co-author Joey Moloney acknowledged it would be expensive – and frustrating for locals – to build in inner Melbourne, but said that “if we want to have enough homes for people living in well-located areas, and that includes vulnerable people that need social housing, then we’re going to have to break a few eggs to make an omelette”.

Changing zoning laws, as the Victorian government is attempting, would enable medium to large density dwellings in these areas, he added, and could be cheaper for taxpayers in the long term than building in greenfield sites.

“It costs between two and four times less to service a dwelling in an established suburb with infrastructure than it does for a new home on the suburban fringe,” Moloney said.

A City of Stonnington Council spokesperson said: “Stonnington has the highest proportion of social housing in the Inner South East Region.”

She said the council, while not “primarily responsible for providing social and affordable housing … will continue to advocate for well-located, good quality and appropriately funded affordable housing”.

A Victorian government spokesperson said the government is working to build more social affordable housing, and homes close to jobs, services, public transport and education.

“Our landmark $6.3 billion investment in social and affordable housing will deliver more than 13,300 new homes – and more than 6300 families have already moved into their homes,” the spokesperson said.

The Big Housing Build is investing in social homes: $290 million in South Yarra to build 526 new homes, $63 million in Carnegie to build 120 new homes, $34 million in City of Melbourne to build 66 new homes, $7 million in Glen Waverley to build 17 new homes, $5 million in Southbank to build 13 new homes and $500,000 in Caulfield for one new home.