melbourinians thrown a lifeline

Baillieu Government releases land for two new Melbourne suburbs
Peter Rolfe From: Sunday Herald Sun January 23, 2011 12:00AM

Planning Minister Matthew Guy shows where new housing will be built near Greenvale. Picture: Ian Currie Source: Sunday Herald Sun
VICTORIANS hoping to buy their first home will today be thrown a lifeline with the Baillieu Government to announce a plan to slash Melbourne land prices.
Two new suburbs to be announced today - Greenvale North and Greenvale West - will house about 7000 people in 1570 houses on 363ha about 20km from the CBD.

Construction will start later this year on the suburbs, bordering Craigieburn and Roxburgh Park.

Once complete, the suburbs will form a major residential region with views of the Dandenongs and the city. But residents will face some major infrastructure problems, at least in the short term.

The nearest train station is almost 6km away in Roxburgh Park while it's 9km to the closest police station in Craigieburn.

But the Government is planning to build new schools, community centres, sporting ovals and parks in the new suburbs.

Similar suburbs are expected to be announced this year in Melbourne's west, north and outer southeast, to meet an estimated shortfall of 100,000 Melbourne lots.

The Greenvale sister suburbs are part of the biggest land release in Melbourne's history, with about 50,000 new lots to be released on to the market by the end of the year.

The Government will also today announce the approval of two new suburbs in Melbourne's north - the first of dozens to be given the go-ahead in urban growth areas this year.

The blueprint to improve housing affordability is aimed at creating more space for new homes, bringing more developers into the market and reducing the price of land in Melbourne's outer areas.

Planning Minister Matthew Guy said the Government was so determined to drive down land prices it would even consider expanding the urban growth boundary or free up land closer to the CBD.

Mr Guy has ordered the Urban Growth Authority to find more land to meet growing demand for houses.

He says the Government will constantly monitor land prices in growth areas.

And he has asked for land scheduled to come on to the market next year to be fast-tracked this year.

"We're just committed to making land as affordable as possible," he said.

"The problem Melbourne has had for the past 10 years has been that government has restricted land release and this has had an impact on price. It's simple. This Government has to find more homes in growth areas and we have to find more opportunities in inner-urban areas."

Five years ago, the average block of land in a Melbourne growth area cost $133,000.

It now costs more than $200,000 and the Housing Industry Australia last week rated Melbourne the least affordable housing of any Australian capital city.

New figures released yesterday show Victoria's median house price has spiralled through $600,000.

The average Melbourne loan repayment is $3334 a month - more than $833 a week.

Mr Guy said the price would soar even higher unless land supply improved, describing the situation as "dire" and "unsustainable" for young families trying to enter the market. He said the ambitious land rollout, a record release in a calendar year, was aimed at easing the burden on Victorians desperate to buy their first home.

"People want an opportunity to be a first home buyer and at the end of the day, we need to do the right thing by people who want to get into the market," Mr Guy said.

"Otherwise we'll end up with a generation who have been priced out of the housing market because the government has failed to make enough land available.

"And we're determined to not let that happen on our watch."

The move is set to spark a land-buying bonanza as Victorians move to cash in on new parcels up for grabs.

Melbourne's population is growing by about 90,000 people a year but fewer land blocks were released in the last quarter than in the same period six years ago.

In September 1996, there were 3097 vacant lots of land in Melbourne. Last September there were just 866.

The median lot size shrunk from 554 square metres to 495 square metres during the same period.

Mr Guy declared 2011 would be the "year of bringing land to market".

"This is the start of a year of land release, which will fire the first real shot over the bow of housing affordability," he said.