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130169_Ballarat HNA_VIF2014_Update_Final_140917

Ballarat Housing Needs Assessment (update) Final Report City of Ballarat September 2014

130169_Ballarat HNA_VIF2014_Update_Final_140917

This report has been prepared for City of Ballarat. SGS Economics and Planning has taken all due care in the preparation of this report. However, SGS and its associated consultants are not liable to any person or entity for any damage or loss that has occurred, or may occur, in relation to that person or entity taking or not taking action in respect of any representation, statement, opinion or advice referred to herein. SGS Economics and Planning Pty Ltd ACN 007 437 729 www.sgsep.com.au Offices in Brisbane, Canberra, Hobart, Melbourne, Sydney

http://www.sgsep.com.au/

Ballarat Housing Needs Assessment (update)

TABLE OF CONTENTS

EXECUTIVE SUMMARY 1 Housing needs approach 1

Population scenarios 2

Housing demand forecasts 2

Housing need assessment 4

Housing need and identified future supply 5

Key demographic segments 5

Affordable housing requirements 6

GLOSSARY 7 1 INTRODUCTION 8 1.1 Project context 8

1.2 Report purpose 9

1.3 Report structure 9

2 POLICY REVIEW 10 2.1 Local planning policy framework 10

2.2 Planning for growth in Ballarat West 12

2.3 Ballarat Residential Infill Opportunities Study 17

2.4 Affordable Housing Review 18

2.5 Delivery of supporting infrastructure and services 18

3 HOUSING SUPPLY 19 3.1 Existing housing supply 19

3.2 Residential land supply 24

3.3 Broader catchment analysis 25

4 HOUSING DEMAND 29 4.1 Overview 29

4.2 Population and household formation 30

4.3 Dwelling preferences and demand 35

5 SEGMENT ANALYSIS 46 5.1 Selected demographic segment profile 46

5.2 Selected demographic segment housing demand 48

6 HOUSING AFFORDABILITY 49 6.1 Housing affordability 49

6.2 Existing housing stress 50

6.3 Ballarat affordable housing target 52

7 HOUSING NEEDS ASSESSMENT 53

Ballarat Housing Needs Assessment (update)

7.1 Future demand aligned with current housing stock 53

7.2 Future demand aligned with planned supply 56

Ballarat Housing Needs Assessment (update) 1

EXECUTIVE SUMMARY

The City of Ballarat is preparing its long term strategy and vision, Today Tomorrow Together: The Ballarat Strategy (the Ballarat Strategy). The Ballarat Strategy will set the overarching framework for how the City will grow and develop into the future, based on the vision and aspirations of the Ballarat community. Environmental constraints limit further urban expansion opportunities in Ballarat. Infill development within existing urban areas is encouraged, provided that built heritage is protected and the use of existing infrastructure is maximised. SGS Economics and Planning (SGS) were engaged by the City of Ballarat to undertake a Housing Needs Assessment to help support the evidence base behind the Ballarat Strategy. This Housing Needs Assessment provides clear guidance on how much housing is needed in Ballarat and considers implications for factors such as land supply, housing type (such as detached houses, semi-detached houses or unit\apartments) and housing size (number of bedrooms). The assessment also considers the drivers of demand for housing and how key segments of the population influence demand for housing, including its location, density, type and affordability.

Housing needs approach

Estimates of dwelling demand for the region have been generated using an SGS in-house housing propensity model. The model estimates implied demand for dwelling types by analysing the likelihood, or propensity, for particular age groups to form particular households and then those households to reside in particular dwelling forms.

HO USING DE MAND APPRO ACH

Demand is then aligned to existing supply to determine the amount and type of additional housing that is needed in Ballarat out to 2040. This future supply requirement is referred to as the housing supply ‘gap’.

Dwelling Types -Urban Forms -Size (#Beds)

Population

by Age Household

Types


Population scenarios

A key input into housing demand is population growth. For this assessment three different population scenarios have been tested:

Low scenario: adopts growth rates in line with the 1996 to 2006 (1.1 per cent per annum)

Medium scenario: aligns with City of Ballarat’s base case forecast, provided by id consulting (1.3 to 1.5 per cent per annum), and

High scenario:adopts VIF 2014 population forecasts by age (VIF 2014 provides forecasts up to 2031, and these growth trends are assumed to hold for subsequent years).

BALL ARAT PO PULATION FO RECASTS

Source: ABS Estimated Resident Population 2013, id forecasts, Victoria in Future 2014 and SGS Economics & Planning

Housing demand forecasts

Demand forecasts were developed for Ballarat based on projected population, demographic changes, changes to household formation structures and changes to dwelling preferences. An alternative base case scenario was also developed which illustrates the impact on demand resulting from an increased diversity of housing supply. This results in a better alignment of household types with dwelling types. Results for the base population scenario are presented in the table below. An estimated 66,590 dwellings will be demanded by Ballarat residents by 2040. The majority of these dwellings are forecast to be separate houses (54,390 dwellings), with 7,060 semi-detached dwellings and 4,750 units. This is based on a forecast of an additional 46,720 people across all household types. Semi-detached dwellings are forecast to have the strongest growth rate of the dwelling types, of 3.9 per cent per annum.

BALL ARAT HO USING DEM AND BY DWELL ING TY PE , BASE CASE

2011 2021 2031 2040 2011 – 2040

Change Annual Growth

Separate house 32,720 38,170 44,250 54,390 21,670 1.8% Semi-detached/townhouse 2,340 3,330 4,680 7,060 4,720 3.9% Flat/unit/apartment 2,990 3,480 3,790 4,750 1,760 1.6% Other 230 270 310 390 160 1.8%

Total Private Dwellings 38,280 45,250 53,030 66,590 28,310 1.9%


Source: SGS Economics and Planning

The following presents the impact on demand if dwelling preference by household types were altered to reflect a more diverse supply of housing options.

BALL ARAT HO USING DEM AND BY DWELL ING TY PE , ALTE RNATIVE SCENAR IO

2011 2021 2031 2040 2011 – 2040



Total Private Dwellings 38,280 45,250 53,030 66,590 28,310 1.9% Source: SGS Economics and Planning

In terms of the dwellings size (number of bedrooms), the largest demand is forecast for two bedroom dwellings, with an additional 11,840 of this dwelling type demanded by 2040 (a 3.6 per cent per annum growth rate). Three bedroom dwellings also have a large demand forecast, of an additional 11,670 dwellings by 2040.

BALL ARAT HO USING DEM AND BY NUMBE R O F BE DROOMS, BASE CASE

2011 2021 2031 2040 2011 – 2040


None (includes bedsitters) 70 40 60 90 20 0.9% One bedroom 1,530 1,640 1,610 1,730 200 0.4% Two bedrooms 6,620 9,690 12,700 18,460 11,840 3.6% Three bedrooms 20,020 23,550 25,230 31,690 11,670 1.6% Four or more bedrooms 10,040 10,320 13,430 14,620 4,580 1.3%


With increased housing diversity we see again that demand preferences shift toward smaller dwelling sizes. This is predominately driven by strong growth forecasts for smaller household types (i.e. lone person households and couples with no children) which, if available, will prefer smaller housing options.

BALL ARAT HO USING DEM AND BY NUMBE R O F BE DROOMS, ALTE RNAT IVE SCE NARIO

2011 2021 2031 2040 2011 – 2040


None (includes bedsitters) 70 120 170 260 190 4.6% One bedroom 1,530 2,220 3,020 4,630 3,100 3.9% Two bedrooms 6,620 9,920 13,850 21,170 14,550 4.1% Three bedrooms 20,020 23,160 26,370 31,660 11,640 1.6% Four or more bedrooms 10,040 9,820 9,610 8,860 -1,180 -0.4%



Housing need assessment

A comparison of the City’s current supply of housing and future demand is presented below. The current supply is given by the 2011 stock of dwellings within the local government area. The demand for all future years has been compared to 2011 stock, with a five per cent allowance for unoccupied dwellings. Under the base case scenario in 2040, there is estimated to be a gap of 28,310 dwellings between the current supply and future forecast demand. This is mostly made up of separate houses (21,800) followed by semi-detached dwellings (4,680) and units (1,670). This gap is due to there being a greater level of demand for dwellings in 2040 than what is currently supplied across the municipality. It represents the future provision of housing required in Ballarat to meet the forecast population growth, demographic change and changes is dwelling type preferences.

HO USING SUPPLY AND D EMAND, BASE CASE

Separate house Semi-detached Units Other Total

2011 Supply 34,340 2,510 3,250 230 40,330

2011 Demand 32,720 2,340 2,990 230 38,280 2021 Demand 38,170 3,330 3,480 270 45,250 2031 Demand 44,250 4,680 3,790 310 53,030 2040 Demand 54,390 7,060 4,750 390 66,590 2011 Gap - - - - - 2021 Gap 5,580 950 400 50 6,970 2031 Gap 11,660 2,300 710 90 14,750 2040 Gap 21,800 4,680 1,670 170 28,310 Source: ABS Census 2001, 2006 & 2011

The same comparison between supply and demand has been produced for the alternative base case, high and low population scenarios. These are shown in the table below. Reflecting a higher demand for dwellings, a gap of approximately 36,880 dwellings is identified in the high scenario by 2040. A forecast gap of 21,500 dwellings is identified in the low scenario.

HO USING SUPPLY AND D EMAND, HIG H AND LO W SCE NARIO


Alternative Scenario

2011 Supply 34,340 2,510 3,250 230 40,330 2040 Demand 49,050 6,430 10,330 780 66,590 2040 Gap 16,460 4,050 7,250 560 28,310

High Scenario

2011 Supply 34,340 2,510 3,250 230 40,330 2040 Demand 61,390 7,970 5,360 440 75,160 2040 Gap 28,800 5,590 2,280 220 36,880 Low Scenario 2011 Supply 34,340 2,510 3,250 230 40,330 2040 Demand 48,830 6,340 4,260 350 59,780 2040 Gap 16,240 3,960 1,180 130 21,500 Source: ABS Census 2001, 2006 & 2011

This highlights the importance of meeting the forecast demand for smaller dwelling types and ensuring that residential infill development opportunities, such as those identified in the Ballarat Residential Infill Opportunities Study, are realised.


Housing need and identified future supply

The Residential Land Supply Review (Hill PDA 2013) identified a total supply of 20,504 lots without significant constraints within City of Ballarat. This potential supply has been aligned with projected housing needs (i.e. gap in current housing supply) to determine how many years it represents for the City of Ballarat. A series of possible development scenarios are presented which assume between 50 – 100 per cent of the housing demand is realised in greenfield locations. Greenfield and Infill development represent the two key sources of future housing supply in Ballarat and both play an important, and complementary, role in the housing market. Based on this needs assessment a 70:30 split between greenfield and infill development would provide the right mix of housing types while also meet future demand requirements across the City of Ballarat. Under the Base Case demand scenario and with 70 per cent development occurring in greenfield locations there is estimated to be approximately 25-30 years of greenfield supply.

HO USING DE MAND AND G RE ENFIE LD L AND SUPPLY

Percentage demand met from Greenfield supply 100% 90% 80% 70% 60% 50%

Base case/ Alternative1

21 years 23 years 25 years 27 years 27+ years 27+ years

High scenario 18 years 19 years 20 years 22 years 25 years 27+ years

Low scenario 26 years 27+ years 27+ years 27+ years 27+ years 27+ years

Source: Hill PDA, 2013, SGS Economics and Planning 1 The alternative scenario matches the base case scenario as total dwellings, not dwelling mix, have been used.

Key demographic segments

Three key segments of the population which will likely have a significant influence on the wider housing market were separately analysed. These were; students, professionals and retirees. The largest forecast growth in dwelling demand is for retirees, estimated to require an additional 9,380 dwellings by 2040. Demand within the professional and student population segments is also forecast to be reasonably strong, particularly for smaller dwelling type.

BALL ARAT K EY SEGMENT HO USING DE MAND GROWT H BY DWEL L ING TY PE, BASE CASE

2011 to 2040

Tertiary Students Professionals Retirees




Separate house 2,720 1.3% 3,800 1.3% 7,200 2.3% Semi-detached/townhouse 560 3.7% 690 3.8% 1,490 4.2% Flat/unit/apartment 210 1.6% 280 1.8% 630 1.9% Other 20 2.4% 20 1.8% 50 2.1% Total Private Dwellings 3,500 1.4% 4,780 1.5% 9,380 2.4%


The following key findings where made:

Tertiary students will drive demand for affordable rental dwellings, located close, or within easy access to, tertiary institutions

Professionals are likely to have similar demand preferences to the broader population while with a focus toward the premium end of the housing market.


The retiree segment of the market will drive increasing demand for affordable, small, low maintenance dwellings, located close, or within easy access to, services (particularly health care services) in Ballarat.

Affordable housing requirements

The affordability challenge is complex and a simple ‘affordable housing target’ cannot be developed in isolation. However, research on social and affordable housing found that a social housing target of between 8.5 and 15 per cent of all housing was required to address social housing needs, depending on the groups identified as being most in need of housing. Based on the 2011 Census only 4.9 per cent of Ballarat’s dwellings stock is defined as ‘social housing’ (1890 dwellings). This suggests there is a currently a gap in the provision of social housing in the City of Ballarat of between 1360 and 3850 dwellings (based on a need of 8.5 to 15 per cent of total stock). If no additional social housing is added this gap could increase to between 3770 and 8110 by 2040.


GLOSSARY

Term Definition

ABS Australian Bureau of Statistics

City of Ballarat Refers to the Local Government Area (LGA) boundary of the City of Ballarat

Separate house This is a house which is separated from other dwellings by at least half a metre.

Semi-detached, row or terrace house, townhouse (also semi-detached)

These dwellings have their own private grounds and no other dwelling above or below them. They are either attached in some structural way to one or more dwellings or are separated from neighbouring dwellings by less than half a metre.

Flat, unit or apartment (also units)

This category includes all dwellings in blocks of flats, units or apartments. These dwellings do not have their own private grounds and usually share a common entrance foyer or stairwell. This category also includes flats attached to houses such as granny flats, and houses converted into two or more flats.

Other dwellings Include caravan, cabin, houseboat, improvised home, tent, sleepers-out, house or flat attached to a shop, office etc

Melbourne Refers to Metropolitan Melbourne, as currently defined by Melbourne Statistical Division.

LGA Local Government Area

SLA Statistical Local Area

Other tenure types Includes dwellings being occupied rent-free, or under a life tenure scheme.


1 INTRODUCTION

1.1 Project context

SGS Economics and Planning (SGS) were engaged by the City of Ballarat to undertake a Housing Needs Assessment for the municipality. The assessment forms one of several background papers which will help support the evidence base behind the new long term strategy and vision, Today Tomorrow Together: The Ballarat Strategy (the Ballarat Strategy) which council is currently developing. The Ballarat Strategy will set the overarching framework for how the City will grow and develop into the future, based on the vision and aspirations of the Ballarat community. Now is an opportune time to develop a new strategy for the City given; the continued growth projected for Ballarat; opportunities emanating from proposed State Government changes to planning provisions; the development of Regional Growth Plans; growth planning recently completed for Ballarat West and benefits of integrating Council’s key strategies to support the health and wellbeing of the community. The Ballarat Strategy will focus on sustainable growth and development, infrastructure investment and community service needs to ensure the lifestyle that Ballarat residents expect, now and in the future. Figure 1 shows how the Ballarat Strategy will be developed.

F IGURE 1. PRE PARAT IO N O F T HE B AL L ARAT ST RATEGY

Source: City of Ballarat 2013

The Ballarat Strategy will incorporate a community-led vision that will be supported by a technically informed long term spatial strategy. This Housing Needs Assessment will feed into the Options Paper and Community Conversation phase of the strategy development, planned for late 2013.


This ‘update’ report includes a revised high population scenario population to reflect recently released state government population forecasts. No other inputs have been changed however implications of the high scenario have been calculated, such as the housing gap and years of supply. The original high scenario assumed that the recent high growth rates would persist into the future, and projected population based on these. The report update replaces these projections with the population forecasts of VIF 2014. The VIF 2014 projections are higher than the previous high scenario forecasts for all years. This is primarily driven by increases in the 25-44 and 65+ age groups, leading to a greater increase in demand for both detached and small scale housing.

1.2 Report purpose

This Housing Needs Assessment will provide clear guidance on how much housing is needed in Ballarat based on projected population growth. It will consider the implications from factors such as existing supply, housing type (such as detached houses, semi-detached houses or units/apartments) and housing size (number of bedrooms). The assessment will also investigate the drivers of demand for housing and how key segments of the population will influence demand for housing, including its location, density, type and affordability. A broad assessment of the surrounding catchment will also be undertaken to provide an understanding of how these areas may impact on the Ballarat housing market.

1.3 Report structure

The remainder of this report is structured as follows:

Section 2 reviews relevant policy and strategy documents to gain an understanding of the policy environment impacting upon the provision of housing in the City of Ballarat.

Section 3 looks at housing demand within the City for a range (low, medium and high) of population growth scenarios.

Section 4 examines the housing needs within the City’s key population segments as well as current and future housing supply.

Section 5 compares projected housing demand and supply to determine future housing need within the City of Ballarat.


2 POLICY REVIEW

The following section reviews relevant policy and strategy documents to gain an understanding of the policy environment impacting upon the provision of housing in the City of Ballarat.

2.1 Local planning policy framework

The following section outlines Ballarat’s current Municipal Strategic Statement (MSS), specifically in relation to housing. It should be noted that the current MSS is dated and SGS understands that the City of Ballarat is now planning for it to be substantially revised. The current MSS notes Ballarat’s key strategic position at the centre of some of Victoria’s most important freight, tourist and commuter transport routes. It outlines the growth of key industries such as manufacturing, tourism, health and community services, education and retailing, which, along with banking, finance and government services sectors, are strengthening Ballarat’s role as a regional services provider. Information technology is also emerging as a regionally significant industry. The current MSS highlights housing issues for Ballarat as being:

maintaining an appropriate supply of residential land

planning for urban growth

achieving the dual objectives or urban consolidation and heritage conservation, and

developing Brownfield residential opportunities. The current MSS indicates that significant recent growth in Ballarat has seen many areas available for residential, industrial and commercial use taken up. Urban expansion opportunities within Ballarat are limited by water supply catchments, high quality agriculture areas and State Forest and plantation land. Infill development within existing urban areas is encouraged, provided that built heritage is protected and use of existing infrastructure is maximised. Figure 2 illustrates the location of existing residential areas and where future residential growth is planned for Ballarat based on the current MSS.


F IGURE 2. RES IDE NT IAL F RAMEWO RK PL AN, BALL A RAT C ITY COUNCIL

Source: Ballarat City Council, 2012

The current MSS sets three objectives specifically relating to housing, with a number of strategies sitting under each objective. Strategies particularly relevant to the location of future housing are listed below. Objective 1. To provide for residential growth in an orderly and efficient manner.

Strategy 1.4. Contain residential development in Buninyong to within the existing residential area.

Strategy 1.5. Facilitate residential development in the Ballarat West Growth Area that is in accordance with the Alfredton West and Ballarat West Precinct Structure Plans.


Objective 2. To provide a wide range of housing choice, diversity, form and affordability, including infill and multi-unit development.

Strategy 2.1. Provide residential land within a range of areas in order to provide for different sectors of the housing market.

Strategy 2.2. Encourage a range of lot sizes and densities within new residential subdivisions.

Objective 3. To promote and facilitate urban consolidation within the older, established areas of Ballarat to maximise the use of existing resources and infrastructure.

Strategy 3.1. Enable Brownfield development sites, which are less than 10 hectares in area and which are surrounded by residential development, to be redeveloped for housing without the need for a residential land supply/demand analysis.

Strategy 3.2. Promote residential development in areas with good access to major areas of commercial activity, other residential development and leisure and recreation activities.

Strategy 3.4. Facilitate the redevelopment of vacant upper floorspace within the Ballarat CBD for residential purposes.

The current MSS references the Canadian Valley Outline Development Plan 2005 that outlines future growth for Mount Clear, Mount Helen, Buninyong, the University of Ballarat and the University of Ballarat Technology Park. Canadian Valley is expected to reach over 11,000 people by 2021, equating to demand for around 1400 additional dwellings in designated areas for growth. The current MSS predicts a 12 year supply of residential land in Canadian Valley. Infill development within Buninyong township is encouraged through the development of existing lots, as is medium density housing near retail and community facilities in Mt Clear.

2.2 Planning for growth in Ballarat West

A range of plans have been developed by the City of Ballarat and these focus on anticipated population growth. Planning for predicted growth has centred on the Ballarat West Growth Area. Located to the west of Alfredton, Delacombe and Sebastopol, the Ballarat West Growth Area comprises 1717 hectares of Greenfield land. The area will accommodate around 18,000 new houses and a population of over 40,000 people. An efficient housing outcome for the area is planned through a number of key principles1. These include:

ensuring an adequate housing supply

planning for multiple development fronts a range of pricing

diversity of housing product, and multiple housing developers in competition. The Ballarat West Growth Area Plan

2 provides a long term strategic land use plan, from which more

detailed precinct structure plans have been developed. The plan outlines the existing infrastructure, urban form and topography of the site, highlighting potential constraints on development in the growth area and sites of desired development. Ballarat West Growth Area is highlighted as being a sustainable development, in line with the principles of ecologically sustainable development. Ecologically sustainable development applies to the protection of biodiversity and an urban form which would minimise resource use and pressure on households to consume non-renewable resources. The plan provides a number of preferred outcomes, including accessible community facilities, such as primary and secondary schools and early childhood centres, along with well located local neighbourhood centres which may promote walking and cycling.

1 CPG Consulting (2010), Social and Community Infrastructure Needs Assessment for the Ballarat West Growth Area, prepared for

the City of Ballarat 2 Tract Consultants (2009), Ballarat West Growth Area Plan, prepared for the City of Ballarat


More specifically the Ballarat West Precinct Structure Plan

3 outlines the expected development

outcomes of Precincts 1, 2 and 4 of Ballarat West and identifies the community infrastructure and support services required to service the development. A Development Contributions Plan has been developed in conjunction with the precinct structure plan. The precinct structure plan also provides the basis for the use and development controls that will be applied. The three precincts within the Ballarat West Precinct Structure Plan are:

Sub-Precinct 1: Bonshaw Creek

Sub-Precinct 2: Greenhalghs Road, and Sub-Precinct 4: Carngham. Sub Precinct 3 – Alfredton West – Lucas is subject to a separate precinct structure plan which is outlined later in this section. The precincts will be linked by the Ballarat Western Link Road, which will connect the Western and Midland highways, providing regional connections for future residents. The main aim of the precinct structure plan is to encourage a healthy, affordable and sustainable community. It is proposed that a network of activity centres will provide focal points for the local community, with retail, recreation and community facilities located in or near these neighbourhood centres. The Ballarat West Precinct Structure Plan aims to achieve a density of 15 dwellings per hectare. Standard housing objectives include walkable, accessible neighbourhoods with a range of lot sizes and housing types. Flexibility in subdivision is encouraged to accommodate future growth and respond to future resident and housing needs. Affordable housing is promoted through a mix of housing types (private and social housing in around activity centres), as well as medium to higher density housing on a range of lot sizes to provide future residents with greater choice. Specifically, the precinct structure plan:

encourages medium density housing within walking distance of activity centres, community hubs and open space

supports specialised housing forms, such as retirement villages, close to activity centres, facilities and services and the transport network, and

support larger lots at Winter Creek to provide transition between existing rural areas and urban development.

Figure 3 overleaf depicts the three precincts covered by the Ballarat West Precinct Structure Plan while Figure 4 illustrates the location of future housing, industrial areas and community facilities.

3 SMEC Urban (2012), Ballarat West Precinct Structure Plan, prepared for the City of Ballarat


F IGURE 3. BALL ARAT WEST PRE CIN CT ST RUCTURE PL AN ST UDY ARE A

Source: Ballarat West Precinct Structure Plan, 2012


F IGURE 4. BALL ARAT WEST L AND USES

Source: Ballarat West Precinct Structure Plan, 2012


The Alfredton West Precinct (sub-precinct 3) Structure Plan4 covers a 317 hectare site, located six kilometres from the Ballarat city centre, adjacent to the proposed Ballarat Link Road. The precinct structure plan proposes socially sustainable housing, diversity of lot sizes and housing, provision of early delivery of community infrastructure and affordable housing. Affordable housing is to be achieved through the creation of small lots and diverse housing types, in particular in high amenity locations. The housing envisaged in Alfredton West - Lucas will provide an opportunity for residents to ‘age in place’. This will be achieved by concentrating affordable housing and higher density housing around the proposed neighbourhood activity centre and close to public transport. Alfredton West is also envisaged as a community centre where residents can walk to reach social services. At full development (2050), Alfredton West is expected to have 11,000 residents, primarily composed of couple families with children. Figure 5 illustrates the housing plan provided in the Alfredton West Precinct Structure Plan. It depicts select areas of medium density housing surrounding areas of open space, community and education uses and the planned neighbourhood activity centre.

F IGURE 5. HO USING PL AN, AL FRE DTO N WEST PRE CINCT ST RUCTURE PL AN

Source: City of Ballarat, 2011b, ‘Plan 10 -: Housing Plan’

4 Integra (2011), Alfredton West Precinct Structure Plan, prepared for the City of Ballarat


2.3 Ballarat Residential Infill Opportunities Study

The Ballarat Residential Infill Opportunities5 study identifies 87 infill sites, 34 broadhectare sites and the

Ballarat West Growth Area Plan sites as having 1703 hectares of developable residential land, including 152 hectares of residential infill land. The study identifies students, medical workers, investors, first home buyers and older persons as the market segments most likely to be involved in infill development in Ballarat. The study makes recommendations to ensure that the land identified for infill development reaches its potential. Recommendations include that a preferred medium density development area be adopted, that rezoning principles are followed and that a variety of strategies be put in place to remove constraints to infill development. The figure below shows infill opportunities within Ballarat.

F IGURE 6. INF IL L HO USING SUPPLY, C ITY O F BALL ARAT

Source: Aurecon, 2009

5 Aurecon (2009) Ballarat Residential Infill Opportunities Study, prepared for the City of Ballarat


2.4 Affordable Housing Review

The City of Ballarat commissioned SGS to undertake an Affordable Housing Review6 that reviews demand and supply of affordable housing across the municipality, including estimations of housing stress for mortgaged and rental households. The review also considers wider issues, including relevant housing policy, demographic trends which affect supply and demand and the overall stock of housing in Ballarat. The review provides a series of findings and recommendations for the City of Ballarat to address the local gap between demand for, and supply of, affordable housing. Specifically, the review highlights that:

There are many factors influencing demand for affordable housing in Ballarat, including a high relative unemployment rate and an increase in the proportion of residents receiving pensions.

While there are a sufficient overall number of dwellings in Ballarat, there is a mismatch between demand and supply of housing in different areas and housing types. The most accessible locations in Ballarat are in high demand, yet much development is being supplied in the west where there is a lack of available social infrastructure. The development industry is primarily delivering detached, three‐bedroom housing at the premium end of the market, whilst at the same time, new public housing units have not been provided.

The demand for affordable housing is evident, with considerable waiting lists for public housing in Ballarat.

Locations within Ballarat with higher levels of disadvantage, as measured by the SEIFA index, are Wendouree, Sebastopol and Delacombe.

There is a shortage of appropriate rental accommodation in the rental housing market, reflected through the low vacancy rate in Ballarat. This has pushed rental costs higher, and has made it difficult for some households, particularly younger families and young adults, to secure appropriate rental accommodation.

A lack of public rental accommodation has seen increased pressure on the community and not‐for‐profit housing sector. It is estimated that there are around 220 social housing units across the municipality operated by not for profit housing agencies.

2.5 Delivery of supporting infrastructure and services

The efficient delivery of housing requires supporting infrastructure to ensure housing is well-serviced and accessible. This is highlighted in several policy documents, including Ballarat Today, Tomorrow, Together

7, the Social and Community Infrastructure Needs Assessment for the Ballarat West Growth

Area8 and the Ballarat Economic Development Strategy 2010-2014

9.

Types of supporting infrastructure identified include; Libraries, primary and secondary schools, early years hub, kindergartens, multi-purpose community centres, open space, recreation spaces, roads, and urban design and land space investments. The Economic Development Strategy highlights the need for planning reform through the use of priority growth zones and peri-urban growth guidelines. In the economic vision set out in the Economic Development Strategy, Theme 3 seeks to capitalise on population growth. The theme highlights that in-migration of people will accelerate as the City embraces and facilitates growth through the provision of appropriate housing, retailing and other services.

6 City of Ballarat (2011), Affordable Housing Review, prepared by SGS Economics and Planning

7 City of Ballarat (2011), Ballarat Today, Tomorrow, Together, Ballarat

8 CPG Consulting (2010), Social and Community Infrastructure Needs Assessment for the Ballarat West Growth Area

9 SGS Economics and Planning (2010), Ballarat Economic Development Strategy 2010‐2014


3 HOUSING SUPPLY

To ensure a sound basis for assessment of the City’s housing needs, this section provides a clear understanding of the current housing supply in Ballarat. The City’s broader catchment area is also identified.

3.1 Existing housing supply

In 2011, there were approximately 40,320 private dwellings across all of Ballarat. This represents 6.3 per cent of total dwellings in regional Victoria, and 1.8 per cent of the state (see Table 1). The majority of these dwellings were separate houses (34,340 in 2011). The next largest dwelling type was flats, units or apartments with 3230. However, the vast majority of these (3160) where one or two storeys which suggests they are predominately unit type developments, rather than apartment blocks. The fastest growing housing segment was semi-detached dwellings.

TAB LE 1 . BALL ARAT DWELL ING SUPPLY

Dwelling Type 2001 2006* 2011 Annual Growth

2001-2011

Separate House 27,770 30,680 34,340 2.1%

Semi-detached - 1 storey 1,370 1,800 2,180 4.8% - 2 or more storeys 200 280 320 4.8%

Flat, unit or apartment

- 1 or 2 storeys 2,930 3,020 3,160 0.8% - 3 storeys 50 60 60 1.8%

- 4 or more storeys 0 10 10 0.0% Other 380 290 250 -4.1%

Ballarat Total 32,700 36,140 40,320 2.1%

Share of Regional Vic 5.7% 5.9% 6.3% Regional Victoria 569,590 616,180 644,120 1.2% Share of Victoria 1.7% 1.7% 1.8% Victoria 1,914,210 2,089,490 2,282,750 1.8% Source: ABS Census 2001, 2006 & 2011 * Note that adjustments have been made to account for misclassifications in the 2006 dwelling structures types.

Figure 7 shows the current dwelling size as determined by number of bedrooms for each broad dwelling type in Ballarat. Most of the separate houses were three bedrooms (58 per cent) or four or more bedrooms (33 per cent). Semi-detached dwellings were fairly evenly split between two and three bedroom dwellings, 44 per cent and 43 per cent respectively. The majority of units in Ballarat were two bedrooms (68 per cent), with 8 per cent being one bedroom and the remainder three or more bedrooms. The other dwelling types include caravans, cabins, houseboats, tents, sleepers out, or a house attached to a shop or office. Therefore the number of bedrooms for this type varies significantly.


F IGURE 7. DWE LL ING TY PE BY NUM BE R O F BE DRO OMS, BAL L ARAT 2011

Source: ABS Census 2011

Not all of the dwellings identified in Table 1 above are occupied permanently. Figure 8 presents the split in 2011 between occupied and unoccupied private dwellings for each of the dwelling types for the Ballarat local government area. Unoccupied dwellings could be holiday houses, vacant houses, cabins, newly completed and not yet occupied houses, in disrepair, or unoccupied in a retirement village. Only eight per cent of separate houses were unoccupied, whilst 10 per cent and 11 per cent of semi-detached and units were unoccupied, respectively.

F IGURE 8. O CCUPIE D AND UNO CCUP IE D DWE LL ING S BY TY PE , BALL ARAT 2011



It is also useful to examine the tenure type of the dwellings currently in Ballarat, which shows if a house is owned, being purchased or rented. Figure 9 presents the tenure type by each of the main dwelling types in 2011. The majority of separate houses were either owned outright (36 per cent) or owned with a mortgage/being purchased (39 per cent). Approximately 24 per cent of separate houses were being rented. Comparatively, the majority of semi-detached dwellings and units were being rented, 60 per cent and 72 per cent respectively.

F IGURE 9. T ENURE TY PE BY DWE LL ING T Y PE , BALL ARAT 2 011


Note: Other tenure type includes being occupied rent free, under a life tenure scheme or other tenure types


The spatial distribution of dwelling types across Ballarat is shown in Table 2 and Figure 10 and Figure 11 overleaf. From this we can see the two largest suburbs in 2011 were Wendouree and Sebastopol, both with over 4000 dwellings. Sebastopol also has the greatest number of semi-detached and unit dwellings (1050). Other inner suburbs such as Redan, Ballarat North, Ballarat Central, Black Hill and Lake Wendouree also all have a significant share of semi-detached or unit type dwellings (greater than 20 per cent of dwellings). However, in general, semi-detached and unit type dwellings are relatively dispersed across the urban parts of Ballarat with all suburbs still having at least 70 per cent separate houses.

TAB LE 2. DWEL LING SUPPLY TY PE BY SUBURB, 2011

Suburb Separate

House Semi-Detached Units Other Total Dwellings

Wendouree 4,180 360 370 0 4,910

Sebastopol 3,250 120 930 0 4,300 Alfredton 2,330 60 260 0 2,650 Ballarat Central 2,100 210 320 10 2,640 Ballarat East 2,250 190 90 0 2,530 Delacombe 1,750 140 60 0 1,950 Ballarat North 1,380 350 80 0 1,810 Redan 1,120 140 330 0 1,590 Soldiers Hill 1,190 100 90 10 1,390 Canadian 1,100 80 140 0 1,320 Lake Wendouree 1,040 130 150 10 1,330 Brown Hill 1,100 40 140 10 1,290 Mount Clear 1,060 170 20 0 1,250 Buninyong 1,130 20 40 0 1,190 Golden Point 970 60 10 20 1,060 Miners Rest 950 0 0 0 950 Black Hill 720 60 140 0 920 Mount Pleasant 790 90 40 0 920 Mount Helen 840 20 20 0 880 Newington 720 40 30 10 800

Other suburbs 4,420 120 20 150 4,710

Total Ballarat 34,340 2,510 3,250 230 40,330 Source: ABS Census 2011

The map in Figure 10 shows the three broad dwelling types for the entire LGA, Figure 11 then focuses on the urban area. This highlights the cluster of units along the Midland highway south of the city centre. There were also a number of semi-detached dwellings in Wendouree and Ballarat North.


F IGURE 10. MAP OF DWEL LING TY PE S ACROSS BALL ARAT LG A


F IGURE 11. MAP OF DWEL LING TY PE S ACROSS BALL ARAT URBAN AREA



3.2 Residential land supply

In parallel to this study a separate land supply review has also completed (Residential Land Supply Review (Hill PDA 2013)). The study was undertaken to provide a current and realistic review of the suitability and availability of broadhectare land within the City of Ballarat. The study defined broadhectare land as:

Undeveloped land generally located on the urban fringe, zoned for residential development (that has had no previous urban development activity) and the parent lot greater than one hectare as identified in the 2009 UDP (excluding Crown land),

Land within the Township Zone (TZ) (this largely relates to land within Cardigan Village), and

Land which has been rezoned since 2009 as Urban Growth Zone and Low Density Residential Zone for residential purposes (and may have a parent lot of less than one hectare).

The study found that while there is a significant amount of potential land supply in the City of Ballarat, the actual delivery of residential land is dependent upon factors such as site availability, market desirability and development feasibility. These factors relate to the physical availability of undeveloped land, market preference for purchase, location and dwelling type, and the economic viability of a site for development. Six criteria were used to understand the timing of delivery of broadhectare land within the City. The criteria included access to services and transport, amenity, physical characteristics, flooding and bushfire, environmental overlay and community acceptance, and land ownership. In total, the study found 1,753 hectares of broadhectare land was identified as available for development (approximately 20,739 lots). Each parcel of land was assessed against the six criteria to estimate the level of constraints to development (see Table 3).

TAB LE 3. BRO ADHE CTARE LAND SU PPLY – DEL IVERY POTE NT IAL AS OF 2013

Delivery timeframe/ Constraints

Land area (ha)

Net Developable (ha)

Potential lots10

0 - 3 Years 581 530 7,479

Land with Few Constraints 123 116 1,570

Land with Moderate Constraints 679 600 8,015

Land with Major Constraints 275 261 3,441

Sub Total 1,658 1,506 20,504

Land with Significant Constraints 129 0 228

Total 1,786 1,506 20,732 Source: Hill PDA, 2013

Some key findings from the land supply study included:

Local industry experts estimated that the City’s market has the capacity to absorb approximately 750 lots per annum, comprising 500-550 Greenfield lots and 200-250 infill lots.

In the short term a smaller portion of land is expected for delivery due to a downturn in the local housing market and/ or issues related to the delivery of broadhectare land recently.

10

Based on the premise of the majority of the land parcel being developed comprehensively to residential in the nominated

period as opposed to a small portion by an individual owner.


3.3 Broader catchment analysis

The City of Ballarat has a broader catchment area than the Local Government Area boundary. An analysis of resident migration patterns over the last five years and journey-to-work patterns has been completed to help provide some insight into how these surrounding areas interact with Ballarat. Specifically focusing on how they may impact the form of demand in the Ballarat housing market.

Resident migration trends

The City of Ballarat has a usual resident population of 93,500 as of 2011. Of these people 46,600 have stayed in the same house over the last five years, a further 19,000 moved house but stayed within the City of Ballarat. Approximately 16,500 new residents settled in Ballarat and 11,200 residents left over the five year period11, a net inward migration. Figure 12 presents the 20 Statistical Area 2 (SA2) which had the strongest connection with Ballarat. The blue bar represents people moving into Ballarat, the red bar represents people leaving Ballarat and the black box represents the net migration flow. Figure 13 maps the net migration flows.

F IGURE 12. RES IDE NT MIG RAT IO N F LOWS, 2011

Source: ABS Census 2011 (excludes overseas migration)

As would be expected, migration patterns over the last five years are strongest with locations directly surrounding the City of Ballarat. All these locations have a net inward flow for Ballarat (i.e. more people coming to Ballarat than leaving). This seems to be consistent for both the surrounding townships and rural areas. As the regional economy continues to shift toward a more diverse (service based) economy we are increasingly seeing the larger centres, such as Ballarat, draw in the surrounding population as people seek more employment and service opportunities. Net outward migration was relatively small and associated with several locations on the Bellarine Peninsula (Torquay, Ocean Grove, Queenscliff, Portarlington and Highton (a southern part of Geelong))

11

There were also some births and deaths during the period and some residents did not state there migration behaviour.

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and some inner parts of Melbourne (Melbourne, Docklands, Southbank, Parkville, North Melbourne). Both of which offer comparatively higher levels of employment and service opportunities than what is currently available in Ballarat.

F IGURE 13 RES IDE NT MIG RAT IO N F LOWS, 2011


Commuter trends

Analysis of journey-to-work trends shows a quite different spatial pattern to residential migration. Of the 42,000 resident workers, 37,000 (88 per cent) also worked in the City of Ballarat. The remaining 5000 travel out of the City of Ballarat for work. An additional 7000 people living outside of the City of Ballarat travelled in for work. Figure 14 present the 20 SA2s with the strongest connection with the City of Ballarat. The blue bar represents workers coming to Ballarat from elsewhere, the red bar represents workers travelling out of Ballarat to other locations and the black box represents the net flow. Figure 15 maps the net migration flows. Similar to residential migration patterns we see that the strongest relationship is with those areas closest to the City of Ballarat. However, unlike the residential migration patterns, we see net outward flows to the neighbouring larger towns of Castlemaine, Maryborourgh and Ararat. There is also a net outward flow to parts of inner Melbourne and Geelong. The net outward flow to the larger neighbouring towns may indicate a shortage of “professional appropriate” accommodation in those towns. That is, predominately rental housing, centrally located and typically smaller form dwellings. However, the net outward flow to Melbourne and Geelong may indicate the un-affordability of housing in those respective markets and the comparative advantage that Ballarat provides. The V-line connections play a significant role in this aspect of demand.


F IGURE 14. WO RK E R T RAVE L PAT TE R NS, 2011


F IGURE 15. NET WO RKE R T RAVEL PATTE RNS , 2011


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Summary

This brief analysis of residential migration and journey-to-work patterns has highlighted some key issues which will impact on the form of Ballarat’s local housing demand.

Ballarat is drawing in population from both surrounding rural areas and the neighbouring townships.

Net outward migration flows are relatively minor and associated with inner Melbourne or the Bellarine Peninsula.

There is a strong inward flow of residents from the surrounding rural areas coming into Ballarat for work.

However, there is a net outward flow to surrounding larger towns (i.e. Aarat, Maryborough and Castlemaine). This suggests that Ballarat is acting as regional hub, particularly for professionals, given its comparatively more diverse housing market.

Ballarat also plays a small role as a ‘commuter town’ for Melbourne and to a lesser extent Geelong. This is a result of the comparatively less affordable housing in those respective markets. The improved speed, frequency and reliability of the V-line services has also supported this trend.

All these various trends suggest there will be an increased demand for centrally located, smaller form housing as the City of Ballarat increasingly takes on a more diverse and regional role.


4 HOUSING DEMAND

The following section identifies housing demand within the City of Ballarat for low, medium and high population growth scenarios. Projected population growth is used to determine household types and, in turn, the implied demand for different types and sizes of dwellings based on household preferences. An alternative medium scenario is also presented which reflects a shift in demand preferences toward small forms of housing.

4.1 Overview

Estimates of dwelling demand for the region have been generated using an SGS in-house housing propensity model. The model estimates implied demand for dwelling types by analysing the likelihood, or propensity, for particular age groups to form particular households and then those households to reside in particular dwelling forms (see Figure 16).

F IGURE 16. HO USING DE MAND APPRO ACH

The approach utilises trends from the past four ABS Censuses (1996, 2001, 2006 and 2011), as well as ABS Estimated Resident Population and id population forecasts. By using a data driven approach the result accounts for existing and changing demographics and preferences. This implicitly incorporates the home buyer’s practical trade-off assessment. A key input into housing demand is population growth. For this assessment three different population scenarios have been tested: Low scenario: adopts growth rates in line with the 1996 to 2006 period (1.1 per cent per annum)

Medium scenario: aligns with City of Ballarat’s base case forecasts, provided by id consulting (1.3 to 1.5 per cent per annum), and

High scenario: adopts VIF 2014 population forecasts by age (VIF 2014 provides forecasts up to 2031, and these growth trends are assumed to hold for subsequent years).

The following provides a summary of the housing demand analysis results. From this it can be seen that there will be demand for between 21,500 and 36,880 additional dwellings in Ballarat. The annual growth rates for dwellings under each scenario are higher than the population growth rates due to falling average household sizes in the future. That is, less people in the same number of dwellings.

Dwelling Types

-Urban Forms -Size

(#Beds)Dwelling

Population by

AgePopulation by Age

Household TypesHousehold

Types


TAB LE 4. BALL ARAT HO USING DEMAND BY DW ELL ING TY PE , HIG H SCE NARIO

2011 2021 2031 2040 2011 – 2040


Base Scenario Population 95,010 110,260 128,330 144,170 49,160 1.4% Dwelling demand 38,280 45,250 53,030 66,590 28,310 1.9% High Scenario Population 95,010 116,670 142,000 162,570 67,560 1.9% Dwelling demand 38,280 47,670 58,720 75,160 36,880 2.4% Low Scenario Population 95,010 105,990 118,240 129,320 34,310 1.1% Dwelling demand 38,280 43,390 48,510 59,780 21,500 1.5%


The following three sections provide further detail regarding the estimated housing demand for the City of Ballarat. The relevant trends in population, household formation and dwelling preferences are also presented.

4.2 Population and household formation

Population and age structure

As of 2011 Ballarat had a total population of 95,000 people, this represents 6.7 per cent of regional Victoria’s population and 1.7 per cent of the state’s population. Between 2001 and 2011, the population of Ballarat grew by 11,390 people, at a rate of between 1.1 to 1.4 per cent per annum. Three population forecasts have been developed for the period 2011 2040 as follows:

The base case scenario uses the id consulting population forecasts for the Ballarat local government area. These assume the recent strong growth rates of 1.5 per cent per annum will continue in the short to medium term and then slow to 1.3 per cent per annum in the longer term (to 2040). Under the base case, an additional 49,160 people are forecast to reside in Ballarat in 2040.

The high scenario adopts the VIF 2014 population forecasts. As VIF only provides forecasts to 2031, SGS projects population for the remaining years. This is done by applying the 2011 – 2031 growth rate of each age demographic for all subsequent years. This results in a forecast of 67,560 additional people by 2040..

The low scenario is based on growth rates that are in line with the 1996 to 2006 period of lower growth, as compared to the most recent period (2006 to 2011). Under a low scenario, an additional 34,310 people are forecast for Ballarat by 2040.

Table 5 and Figure 17 present the population forecasts for the three scenarios, illustrating the diverging levels of population in the medium to longer term estimates.


TAB LE 5. BALL ARAT PO PULATION FO RECASTS

Year Base Case High Scenario Low Scenario

People Annual Growth



2001 83,600 83,600 83,600 2006 88,450 1.1% 88,450 1.1% 88,450 1.1% 2011 95,010 1.4% 95,010 1.4% 95,010 1.4% 2016 102,350 1.5% 104,550 1.9% 100,350 1.1% 2021 110,260 1.5% 116,670 2.2% 105,990 1.1% 2026 119,510 1.6% 129,380 2.1% 111,950 1.1% 2031 128,330 1.4% 142,000 1.9% 118,240 1.1% 2036 137,120 1.3% 153,100 1.5% 124,280 1.0% 2040 144,170 1.3% 162,570 1.5% 129,320 1.0%

2011 to 2040 49,160 1.4% 67,560 1.9% 34,310 1.1% Source: ABS Estimated Resident Population 2013, id forecasts, Victoria in Future 2014 and SGS Economics & Planning

F IGURE 17. BALL ARAT PO PULATION FO RECASTS

Source: ABS Estimated Resident Population 2013, id forecasts, Victoria in Future 2014 and SGS Economics & Planning

Figure 18 presents a population pyramid for Ballarat, showing the number of people by age and sex in 2001, 2011, 2021 and 2040. Population growth in Ballarat over the last 10 years was highest for those aged over 45 years, with very low growth in people aged between 25 and 44 years. This is anticipated to continue into the future. The 15 to 24 year age group experienced relatively strong growth of 1.4 per cent per annum, indicating an increase in secondary school and tertiary aged people. This reflects not only Ballarat’s secondary school offer, but its role as a regional tertiary educational provider, with institutions, such as Ballarat University and others. The growing proportion of people within the 55 to 64 years age group in Ballarat indicates that demand for retirement accommodation and services will continue to increase.


F IGURE 18. PO PUL AT IO N G ROWT H BY AG E AND SEX

Source: ABS Estimated Resident Population cat no 3235.0, 2013,id forecasts

Household formation preferences Certain age groups have a propensity to form particular household types, given their age specific characteristics. For example, children aged between 0 and 10 are likely to be living in a couple or one parent family with children. Alternatively, those aged 65 plus typically form part of a couple family without children or a lone person household. These propensities have been slowly changing which, in turn, have implications for housing requirements. Figure 19 presents household types across the last four Census periods for Ballarat. The figure shows that, in 2011, approximately 45 per cent of the total population of Ballarat resided in a couple family with children household type. In 1996, this household type made up just over half of the total population, and has since fallen. Couple families without children made up 20 per cent of the total population in 2011, up from 16 per cent in 1996. The proportion of one parent families and group households has remained relatively constant over the last 15 years, while the proportion of lone person households has increased marginally, from nine per cent in 1996, to 11 per cent in 2011.

12,000 8,000 4,000 0 4,000 8,000 12,000

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Female 2001 Female 2011 Male 2001 Male 2011

Female 2021 Male 2021 Female 2040 Male 2040


F IGURE 19. HO USE HOL D TY PE FO R TOTAL PO PULAT ION, BAL LARAT

Source: ABS Census 1996, 2001, 2006 & 2011

These changes are largely a result of demographic changes (i.e. an aging population), while there have also been changes to household formation propensities within particular age groups. Figure 20 presents the same breakdown of household type for the population aged between 25 and 34. In this age group the percentage of couple families with children has declined from 52 to 41 percentage over the last 15 years. While conversely the per cent of couple families without children have increased from 18 to 26 per cent over the same period. This highlights the trend in families having children at later stages of their life.


F IGURE 20. HO USE HOL D TY PE FO R PO PUL AT IO N AGE D BE TWEE N 25 AND 34 YE ARS


The household composition for the older population, aged 55 years and over, is shown in Figure 21. The majority of this age group (47 per cent) reside in a couple families without children household. This has increased marginally from 44 per cent in 1996. A significant proportion (25 per cent) also live in lone person households, which has remained constant over the last 15 years.

F IGURE 21. HO USE HOL D TY PE FO R PO PUL AT IO N AGE D 55 YE ARS AND OVE R



This comparison highlights the significant differences in household composition for different age groups and how they are changing in some groups. In general the majority of the population live in a family household of some form. However, the proportion of other family types is increasing as people form more complex family structure. This can be a result of a wide range of factors such as; couples delaying having children; increased rates of divorce; and aging population.

Household type forecasts

The trends from 1996-2011 for each 10 year age group have been projected out to 2040 to capture the evolving household formation structures into the future. These formation propensities have then been applied to the projected population by age under the three scenarios. Table 6 presents population by household type for the Base Case scenario. The largest population growth is forecast for couple families with no children, an increase of 13,110 people between 2011 and 2040 (2.1 per cent per annum). People within lone person households are also forecast to have significant growth of 7,490 people over the same time period, equivalent to an average annual growth rate of 1.9 per cent per annum.

TAB LE 6. BALL ARAT PO PULATION FO RECAST BY HO USE HO L D TY PE, BASE CASE

2011 2021 2031 2040

2011 – 2040


Couple family with children 38,970 41,480 46,650 50,670 11,700 0.9% Couple family with no children 18,930 24,060 28,240 32,040 13,110 1.8% One parent family 12,020 15,220 18,750 22,100 10,080 2.1% Other family 1,540 1,760 2,050 2,360 820 1.5% Group household 4,230 4,530 5,290 5,990 1,760 1.2% Lone person household 10,560 13,150 15,700 18,050 7,490 1.9% Other 8,750 10,060 11,640 12,960 4,210 1.4%

Total Persons 95,000 110,260 128,320 144,170 49,170 1.4% Source: SGS Economics and Planning

Similar trends were evident under the low and high scenarios. These changes will have varying implications for the type of dwellings required. The preferences, and how they have been changing, will be explored in the following section.

4.3 Dwelling preferences and demand

Dwelling structure preferences

The historical trends in dwelling preferences have been used to forecast future dwelling demand. This is an implied demand as it incorporates home buyer’s practical trade-offs based on the supply that is available. If alternative housing stock was available people may potentially present alternative preferences. This has been modelled in the ‘alternative base case’ scenario which presents dwelling demand based on the availability of more diverse housing options. In 2011, approximately 86 per cent of the dwellings in Ballarat were separate houses, slightly higher than in 1996 (85 per cent). The proportion of semi-detached dwellings increased whilst the proportion of units remained relatively unchanged (see Figure 22).


F IGURE 22. BALL ARAT DWEL LING SU PPLY BY DWE LL ING T Y PE


Dwelling structure types for the main household groups in Ballarat in 2011 is shown in Figure 23. In 2011, the majority of couple families with children living in Ballarat resided in a separate house, 97 per cent in 2011. This dwelling propensity has remained constant over the last 15 years, and is therefore likely to continue into the future in the same way. Couple families without children and one parent families had a slightly different dwelling preference than couple families with children. A greater proportion resided in semi-detached dwellings and units. However, the majority (90 per cent) still lived in separate houses. Similarly, a greater proportion (19 per cent) of group households lived in semi-detached dwellings and units. The dwelling preferences of lone person households were notably different, with 30 per cent of this household type living in a semi-detached dwelling or units.


F IGURE 23. DWE LL ING TY PE BY HO USE HOL D TY PE S, BAL L ARAT 2011


Therefore, given the trend of increasing numbers of lone person households and couple families without children there is likely to be increased demand for semi-detached and apartment type dwellings without any change to peoples existing dwelling preferences. The provision of smaller housing types is reflected in the City of Ballarat MSS which aims to provide a range of housing choice and diversity, including infill and multi-unit development, as well as encourage a range of lot sizes and densities within new residential subdivisions. Local policy also encourages smaller CBD dwellings through the redevelopment of vacant upper floorspace.

However, if peoples dwelling preferences did change this would have implications on the future demand for particular dwelling types. The existing supply of housing in Ballarat has impacted on dwelling preferences due to the dominance of separate housing and a limited number of other housing options. Given a more diverse housing stock the preferences of specific household types would likely change. Figure 26 presents the dwelling preferences by household type for the statistical local area (SLA) of Geelong. In comparison to Ballarat (Figure 23) this highlights the greater proportion of people living in semi-detached dwellings and units, particularly for group and lone person households. An alternative scenario has been developed which trends current dwelling preferences in Ballarat towards those currently present in Geelong. This will reflect the type of housing that would be demanded given an increased diversity of housing supply in Ballarat.


F IGURE 24. DWE LL ING TY PE BY HO USE HOL D TY PE S, GEE LO NG 2011


Dwelling size preferences (No. of bedrooms)

Different households also have a propensity to demand varying dwelling sizes, as determined by the number of bedrooms in a dwelling. Future demand by dwelling size can be estimated using these preferences, in the same way as dwelling structural types were forecast. Figure 25 presents the proportion of dwelling stock in Ballarat by number of bedrooms from 2001 to 2011. During this period, the majority of dwellings had three bedrooms, followed by four or more bedrooms, highlighting that a large portion of the current dwelling stock consists of larger houses. Additionally, the proportion of dwellings with four or more bedrooms increased from 24 per cent in 2001 to 31 per cent in 2011. In 2011, 12 per cent of the dwelling stock had two bedrooms and there were very few one bedroom or smaller dwellings.


F IGURE 25. BALL ARAT DWEL LING SU PPLY BY NUMBE R OF BE DRO OMS

Source: ABS Census 2001, 2006 & 2011

Couple families with children reside in the larger dwellings, with 97 per cent of this household type living in a dwelling with three or more bedrooms. The dwelling size preferences for couple families without children, one parent families and group households were fairly similar, with three bedrooms being the most common. Lone person households lived in the largest proportion of one bedroom dwellings across the household types, with 12 per cent of lone persons living in a one bedroom or smaller dwelling in 2011 (see Figure 26).

F IGURE 26. DWE LL ING S IZE BY HO U SE HO LD TY PE S , BALL ARAT 2011


Even with no change to preferences, given the trend of increasing numbers of lone person households and couples without children there is likely to be increased demand for smaller dwellings in Ballarat.


However, the current stock of dwellings in Ballarat results in the implied dwelling size preferences to be focused on larger houses as that is what is most commonly supplied. Similar to the dwelling type preferences, if peoples dwelling size preferences did change this would have implications on the future demand for the size of dwellings. Figure 32 presents the proportion of dwellings by size and household type for Geelong SLA in 2011. This shows a greater proportion of smaller dwellings with one and two bedrooms, compared to Ballarat which had more three and four or more bedroom dwellings. The difference is particularly noticeable for those smaller households which do not require larger sized dwellings.

F IGURE 27. DWE LL ING S IZE BY HO U SE HO LD TY PE S , GE ELON G 2011



Housing demand forecasts

The trends from 1996-2011 for each household type have been projected out to 2040 to capture the evolving dwelling preferences of each household. These dwelling type and size preferences have then been applied to the projected household forecasts under the three scenarios. An alternative base case scenario illustrates the impact on demand from the availability a more diverse housing supply. Table 7 presents the results of this modelling. Under the base case population forecast there is estimated to be 66,640 dwellings demanded by Ballarat residents by 2040. The majority of these dwellings are forecast to be separate houses (54,430 dwellings), with 7070 semi-detached dwellings and 4750 units. This is based on a forecast of an additional 46,720 people across all household types. Semi-detached dwellings are forecast to have the strongest growth rate of the dwelling types, at 3.8 per cent per annum. The analysis suggests that the population will increase demand for smaller, more affordable houses that are close, and easily accessible to services and transport.

TAB LE 7. BALL ARAT HO USING DEMAND BY DWELL ING TY PE , BASE CASE

2011 2021 2031 2040 2011 – 2040




Figure 28 shows the number and proportion of dwellings demanded by dwelling type from 2011 to 2040 for Ballarat. Whilst demand for separate houses is forecast to increase, the proportion of separate houses to total dwelling stock is projected to decline, from 85 per cent in 2011 to 82 per cent in 2040. Demand for semi-detached dwellings is forecast to almost double from six per cent in 2011 to 11 per cent in 2040.

F IGURE 28. BALL ARAT DWEL LING TY PE FO RECA STS , BASE CASE



The forecast demand for dwellings by number of bedrooms is presented in Table 8 below. The largest growth in demand is forecast for two bedroom dwellings, with an additional 11,850 of this dwelling type demanded by 2040 (a 3.6 per cent per annum growth rate). Three bedroom dwellings also have a large demand forecast, of an additional 11,690 dwellings by 2040.

TAB LE 8. BALL ARAT HO USING DEM AND BY NUMBE R O F BE DROOMS, BASE CASE

2011 2021 2031 2040 2011 – 2040




Figure 29 illustrates the number and proportion of dwellings demanded by dwelling size in 10 yearly intervals from 2011 to 2040. It highlights increasing demand for the number of three and four bedroom dwellings, but decreasing share of total dwelling stock. Both the number and proportion of two bedroom dwellings is forecast to increase, with two bedroom dwellings comprising 28 per cent of total stock in 2040. The provision of a diverse range of housing types is consistent with the principles for growth within the Ballarat West Growth Area.

F IGURE 29. BALL ARAT NUMBE R O F BE DROOMS DE MAND FORE C AST, BASE CASE



The alternative base case scenario alters dwelling preference by household type to reflect a more diverse supply of housing options. It still assumes the same base case population and hence total dwelling demand remains the same. Under this scenario demand for units is much greater than under the base case scenario. An additional 7,340 units are forecast to be demanded by 2040, equivalent to an annual average growth rate of 4.4 per cent per annum. Demand for separate housing is much lower, with annual growth rate of 1.4 per cent compared to 1.8 per cent in the base case.

TAB LE 9. BALL ARAT HO USING DEM AND BY DWELL ING TY PE , ALTE RNATIVE SCENAR IO

2011 2021 2031 2040 2011 – 2040




The dwelling demand by type and its proportion of total dwellings is shown in Figure 30. Whilst the number of separate houses increases in 2040, the proportion of total dwelling stock falls from 85 per cent in 2011 to 74 per cent in 2040. Meanwhile, the proportion of units doubles over this same time period. This suggests that if current dwelling preferences in Ballarat were to adjust with changes in household types and dwelling stock, future demand for dwellings could be very different to the base case.

F IGURE 30. BALL ARAT DWEL LING TY PE FO RECA STS , ALTE RNATIVE SCENARIO



Forecast dwelling demand by number of bedrooms is shown in Table 10 for the alternative scenario. As a result of the changed dwelling size preferences demand in 2040 for none, one and two bedroom dwellings is greater than under the base case. Demand for one bedroom dwellings is forecast to increase by 3,100 dwellings to 2040, at an annual growth rate of 3.9 per cent. This compares to a growth rate of 0.4 per cent under the base case.

TAB LE 10. BALL ARAT HO USING DEM AND BY NUMBE R O F BE DROOMS, ALTE RNAT IVE SCE NARIO

2011 2021 2031 2040 2011 – 2040


None (includes bedsitters) 70 120 170 260 190 4.6% One bedroom 1,530 2,220 3,020 4,630 3,100 3.9% Two bedrooms 6,620 9,920 13,850 21,170 14,550 4.1% Three bedrooms 20,020 23,160 26,370 31,660 11,640 1.6% Four or more bedrooms 10,040 9,820 9,610 8,860 -1,180 -0.4%


Figure 31 illustrates the number and proportion of dwelling demand forecast at each ten year interval from 2011 to 2040, showing the increasing proportion of one and two bedroom dwellings. It should be noted that whilst the proportion of three bedroom dwellings is falling, demand for this sized dwelling is still forecast to increase, just at a slower rate than smaller bedroom dwellings.

F IGURE 31. BALL ARAT NUMBE R O F BE DROOMS DE MAND FORE C AST, ALTE RNAT IVE

SCE NARIO



The results of the housing demand modelling for the high and low population scenarios are shown in Table 11 to Table 14 below. Under the high scenario, an estimated 36,880 additional dwellings will be demanded by residents in Ballarat by 2040. This compares to only 21,500 additional dwellings demanded under a low population growth scenario. Under the high scenario, the largest growth in demand is forecast for three bedroom dwellings, with an additional 15,750 demanded by 2040. This compares to only 8,430 three bedroom dwellings demanded under the low scenario.

TAB LE 11. BALL ARAT HO USING DEMAND BY DW ELL ING TY PE , HIG H SCE NARIO

2011 2021 2031 2040 2011 – 2040




TAB LE 12. BALL ARAT HO USING DEM AND BY NUMBE R O F BE DROOMS, HIG H SCE NARIO

2011 2021 2031 2040 2011 – 2040




TAB LE 13. BALL ARAT HO USING DEMAND BY DW ELL ING TY PE , LOW SCE NARIO

2011 2021 2031 2040 2011 – 2040




TAB LE 14. BALL ARAT HO USING DEM AND BY NUMBE R O F BE DROOMS, LO W SCE NARIO

2011 2021 2031 2040 2011 – 2040





5 SEGMENT ANALYSIS

The previous task provided a robust assessment of future housing needs across the entire population of Ballarat. However, to gain a more detailed understanding of housing needs within key population segments, this section provides some additional analysis on key demographic segments.

5.1 Selected demographic segment profile

Key demographic segments have been defined using ABS Census data classifications as follows:

Tertiary students have been defined as those attending Technical or Further Education Institution (including TAFE colleges), University or other institutions. In Ballarat, they make up eight per cent of the total population.

Professionals have been defined as workers in the occupations of Managers and Professionals. In 2011, this group represents 15 per cent of the total population living in Ballarat.

Retirees have been defined as those not in the labour force and aged 60 years and over. In 2011, this group made up 14 per cent of the total population.

These key segments have a significant influence in the wider housing market in Ballarat, given the strong growth forecast for both the student and ageing populations. Figure 32 presents the household types for each segment in Ballarat in 2011. Students tend to live in a group household or in a couple family with children (i.e. living at home with family), whilst professionals mostly live in couple families with and without children. The majority of the retired population live in a couple family without children and in a lone person household.

F IGURE 32. HO USE HOL D TY PE FO R K E Y DE MOG RAPHIC SEG ME NTS, BAL LARAT 2011



Table 15 presents the 2011 population of each group by the dwelling type they resided in. Figure 33 shows the proportion of the dwelling stock for each dwelling type by the key demographic groups. Given the large amount of separate housing in Ballarat, the most common dwelling type across all groups was separate housing, with at least 80 per cent of each group residing in this dwelling type. However, a greater proportion of tertiary students lived in semi-detached and apartment dwellings. In 2011, approximately 450 tertiary students lived in units across the City of Ballarat. Professionals tended to live mostly in separate houses, with a similar number of people living in units (440 in 2011). The retired group showed similar dwelling preferences to tertiary students, with a greater proportion living in semi-detached dwellings and units in 2011. Approximately 960 retired people lived in units in Ballarat and 860 lived in semi-detached dwellings in 2011.

TAB LE 15. DWE LL ING TY PE FO R KE Y DEMOG RAPHIC SEG ME NTS, BALL ARAT 2011

Dwelling Type Tertiary

Students Professionals Retired

Total Population

Separate house 6,030 11,950 10,670 80,940

Semi-detached (1 storey) 330 380 820 3,060 Semi-detached (2+ storeys) 110 160 40 640

Unit (1-2 storeys) 430 410 960 4,170 Unit (3 storeys) 20 30 0 90 Unit (4+ storeys) 0 0 0 20

Other 30 50 90 410

Total 6,950 12,980 12,580 89,330 Proportion of total population 8% 15% 14% Source: ABS Census 2011

F IGURE 33. DWE LL ING TY PE BY KE Y DE MOG RAPHIC SEG ME NTS , BAL LARAT 2011


These household type propensities and dwelling preferences have been used to determine how much of the future dwelling demand (from Section 4) can be aligned to each key group.


5.2 Selected demographic segment housing demand

Table 16 presents the estimated dwelling demand likely to be generated by tertiary students living in Ballarat in the future. By 2040, an additional 3,500 dwellings will be demanded by this group, an increase of 1.4 per cent per annum on current levels. An increase in the tertiary aged population suggests that demand for affordable rental dwellings, located close, or within easy access to, tertiary institutions within Ballarat will remain high.

TAB LE 16. STUDE NT HOUSING DEMA ND BY DWEL L ING TY PE, BASE CASE

2011 2021 2031 2040 2011 – 2040


Separate house 6,150 6,830 7,840 8,870 2,720 1.3% Semi-detached/townhouse 300 430 590 860 560 3.7% Flat/unit/apartment 350 420 460 560 210 1.6% Other 20 30 30 40 20 2.4%


The same demand forecast for professionals living in Ballarat is shown in Table 17. By 2040, this group is forecast to demand 13,760 dwellings, an increase of 4,780 over the next 30 years. This segment of the population is likely to have similar demand preferences to the broader population while with a focus toward the premium end of the housing market.

TAB LE 17. PROFE SSIONAL HOUSING DE MAND BY DWEL L ING TY PE, BASE CA SE

2011 2021 2031 2040 2011 – 2040


Separate house 8,190 9,150 10,430 11,990 3,800 1.3% Semi-detached/townhouse 350 500 700 1,040 690 3.8% Flat/unit/apartment 400 490 540 680 280 1.8% Other 30 40 40 50 20 1.8%


Dwelling demand for retirees has the largest demand for housing of the three key groups (see Table 18 below). An additional 9,380 dwellings are forecast to be demanded by this segment. Based on current preferences the majority of these are in separate housing, however, given the dwelling type propensities of this segment, a significant number of semi-detached and units are also forecast. The retire segment of the market will drive increasing demand for affordable, small, low maintenance dwellings, located close, or within easy access to, services (particularly health care services) in Ballarat.

TAB LE 18. RE TIRE ES HO USING DEM AND BY DWELL ING TY PE , BASE CASE

2011 2021 2031 2040 2011 – 2040


Separate house 7,790 9,550 11,050 14,990 7,200 2.3% Semi-detached/townhouse 640 940 1,340 2,130 1,490 4.2% Flat/unit/apartment 840 1,010 1,120 1,470 630 1.9% Other 60 70 80 110 50 2.1%



6 HOUSING AFFORDABILITY

The existing housing affordability situation based on current levels of housing stress is presented in this section. A review of housing affordability plans and relevant literature follows and is used to determine appropriate affordable housing targets required in Ballarat.

6.1 Housing affordability

In creating healthy and diverse communities, it is important to understand that housing affordability issues are not only experienced by high need households dependent on transfer payments. Moderate income households, which have historically been able to transition from private rental to home ownership but now find it difficult to make this transition, are also affected. Furthermore, they affect key workers who cannot afford to rent or buy in those areas where their services are desperately needed. Each housing market group has different levels of demand for housing, with different requirements and varied susceptibility to housing stress. Each housing market group is placed on the affordable housing continuum (see Figure 34 below). Broadly, it can be said that whilst demand increases to the right of the spectrum (usually culminating in home ownership), unaffordable housing and living costs can increase the propensity of a household to move back through the continuum. Homelessness is excluded from the continuum, as it is not a viable housing option, however, it can occur when all other housing markets become inaccessible.

F IGURE 34 AFFO RDABL E HO USING CO NT INUUM

Source: SGS Economics and Planning 2011, adapted from Fig. 5, Affordable Housing Strategy 2010-20 Government of W.A.

Social housing is provided to those most in need and is owned and managed by the state, housing agencies and the not-for-profit and community sectors. The table below describes the different types of social housing in Victoria.

Public Housing

Social Housing

Private Rental

Home Ownership

affordable housing continuum


TAB LE 19. T Y PES OF SOCIAL HOUS ING IN V ICTO RIA

Housing type Description

Public housing Housing owned and managed by the State through the Director of Housing. The Director of Housing acts as the landlord to public housing tenants.

Community housing Housing managed by not-for-profit registered housing agencies and housing providers for affordable housing purposes.

Transitional housing Transitional housing owned by the State but managed by the community housing sector (i.e. not-for-profit groups).

Social housing The term used to describe public, community and transitional housing.

Source: Department of Human Services

Given the varying needs of different members and groups of the population, it is difficult to know what a minimum target for social housing provision should be. Previous work undertaken by SGS12 identified that a social housing target of between around 8.5 and 15 per cent of all housing was required to address social housing needs, depending on the groups identified as being most in need of housing.

6.2 Existing housing stress

Using a commonly accepted indicator of housing stress the following section investigates the broad status of housing affordability across Ballarat and compares it to key comparator areas. For this analysis a person is defined as experiencing ‘housing stress’ if they are paying more than 30 per cent of their weekly income on housing costs. Data on weekly household income and rents/mortgage repayments was sourced from the ABS Census and examined to determine if the median rent and mortgage repayment in each bracket was greater than 30 per cent of the median household income in each income bracket. If it was greater, that group was said to be experiencing ‘rental/mortgage stress’. Table 20 presents the proportion of the population experiencing rental stress for Ballarat, regional Victoria, Melbourne and Victoria as a whole in 2001, 2006 and 2011. In 2011, approximately 35 per cent of people living in Ballarat were experiencing rental stress, and paying more than 30 per cent of their income on rent. This represented an increase from 2001, up from 29 per cent. It was also higher than all three comparison regions, with 32 per cent of the population in regional Victoria experiencing rental stress.

TAB LE 20. RE NTAL ST RE SS REG IO N AL COMPARISON

2001 2006 2011

Ballarat 29% 31% 35% Regional Victoria 25% 27% 32% Melbourne 30% 29% 33% Victoria 28% 29% 33% Source: ABS Census 2001, 2006 & 2011

Figure 35 shows the proportion in rental stress in each income group for those renting in Ballarat. In 2011, the lower income groups experienced a greater level of rental stress and this has increased over time. This was most significant for the $600 to $799 income bracket, where the proportion of people in rental stress increased from five per cent in 2001 to 50 per cent in 2011.

12

Powerhousing Australia (2009) A Vision and Plan for Social Housing in Australia, prepared by SGS Economics and Planning


F IGURE 35. RE NTAL ST RE SS BY INC OME GROUP, BALL ARAT 2001 TO 2006

Source: ABS Census 2001, 2006 & 2011

Figure 36 shows the proportion of people who were paying a mortgage in 2011 who were in housing stress by each income bracket for Ballarat, regional Victoria, Victoria and Melbourne. Similar to rental stress, a greater proportion of those in the lower income brackets experienced housing stress. Ballarat also contained a greater proportion of the population in housing stress compared to regional Victoria for most income brackets, but a smaller proportion compared to Melbourne and Victoria as a whole.

F IGURE 36. MORTG AGE ST RE SS BY I NCOME GROUP, RE G ION CO MPARISON 2011



6.3 Ballarat affordable housing target

As highlighted in the previous section (Section 6.1) the affordability challenge is complex and a simple ‘affordable housing target’ cannot be developed in isolation. Affordable housing is as much about the lower end of the housing market as it is about the higher end. The primary objective should be supporting the correct alignment of demand and supply across the entire housing system. However, based on the research it was found that a social housing target of between around 8.5 and 15 per cent of all housing was still required to address the needs of those most vulnerable in the community. Based on the 2011 Census only 4.9 per cent of Ballarat’s dwellings stock is defined as ‘social housing’ (1890 dwellings). This suggests there is a currently a gap in the provision of social housing in the City of Ballarat. To provide some indication of the size of this gap and how it may change into the future a series of high level scenarios have been presented in Table 21 below. Social housing need has been estimated based on a figure of 8.5, 10 and 15 per cent of all housing stock. It illustrates a growing gap between current levels of social housing provision.

TAB LE 21. SOCIAL HOUSING NEE DS , BAL LARAT 2011 TO 2 040

2011 2021 2031 2040

Current supply of social housing 1890 1890 1890 1890

Social housing need

based on 8.5% 3,250 3,840 4,480 5,660

based on 10% 3,830 4,520 5,270 6,660

based on 15% 5,740 6,780 7,910 10,000

Social housing gap

based on 8.5% 1,360 1,950 2,590 3,770

based on 10% 1,940 2,630 3,380 4,770

based on 15% 3,850 4,890 6,020 8,110 Source: 2011 ABS Census and SGS Economics and Planning

At a high level, the future need for social housing, and for affordable housing more broadly (as identified in the continuum above), will be impacted by how well the home ownership market performs, which then impacts on demand for private rental, which in turn dictates the number of households not adequately accommodated. At the local government level, housing affordability can be impacted by mechanisms to reduce barriers to entry, making the market more efficient and improving processes, such as faster planning approvals. The City of Ballarat’s local policy promotes the provision of housing choice and affordability through the provision of a variety of lot sizes as well as competition between developers and housing offered at a range of prices.


7 HOUSING NEEDS ASSESSMENT

The following section compares the City’s future housing needs with the current housing stock; and future greenfield supply (based on recently completed Residential Land Supply Review). The assessment identifies if there is sufficient supply in total and if there is the right mix supply with regard to broad housing types.

7.1 Future demand aligned with current housing stock

A comparison of the City’s current supply of housing and future demand is presented in Table 22. The current supply is given by the 2011 stock of dwellings within the local government area. In 2011 there is a small difference between supply and demand which, in reality, is reflected by unoccupied dwellings. This difference represents approximately 5 per cent of the stock and is required for a housing market to operate efficiently. For all future years demand (plus a 5 per cent occupied dwelling allowance) has been compared to the 2011 stock to identify potential future housing needs (i.e. Housing gap) across the City of Ballarat. Under the base case scenario in 2040 there is estimated to be a gap of 28,310 dwellings between current stock and forecast demand. This is mostly made up of separate houses (21,800) followed by semi-detached dwellings (4,680) and units (1,670). This gap is due to there being a greater level of demand for dwellings in 2040 than what is currently supplied across the municipality. It represents the future provision of housing required in Ballarat to meet the forecast population growth, demographic change and changes is dwelling type preferences.

TAB LE 22. HO USING SUPPLY AND DE MAND, BASE CASE

Separate house

Semi-detached Units Other Total

2011 Supply 34,340 2,510 3,250 230 40,330

2011 Demand 32,720 2,340 2,990 230 38,280 2021 Demand 38,170 3,330 3,480 270 45,250 2031 Demand 44,250 4,680 3,790 310 53,030 2040 Demand 54,390 7,060 4,750 390 66,590

2011 Gap - - - - - 2021 Gap 5,580 950 400 50 6,970 2031 Gap 11,660 2,300 710 90 14,750 2040 Gap 21,800 4,680 1,670 170 28,310 Source: ABS Census 2001, 2006 & 2011


Figure 37 presents the gap between current supply and future demand in 2040 by dwelling type.

F IGURE 37. E XIST ING HO USING STO CK AND FO RECAST DE MAND, BASE CASE 2040


A comparison of housing supply and demand for the alternative scenario is shown in Table 23. Whilst the gap for total dwellings is the same as the base case, the gap across the dwelling types varies considerably. More semi-detached, units and other dwelling types are required to close the gap between current supply and forecast future demand, whilst there is less pressure is on separate housing.

TAB LE 23. HO USING SUPPLY AND DE MAND, ALTE RNAT IVE SCENARIO


2011 Supply 34,340 2,510 3,250 230 40,330 2011 Demand 32,720 2,340 2,990 230 38,280 2021 Demand 36,920 3,300 4,660 370 45,250 2031 Demand 41,390 4,430 6,680 530 53,030 2040 Demand 49,050 6,430 10,330 780 66,590 2011 Gap - - - - - 2021 Gap 4,330 920 1,580 150 6,970 2031 Gap 8,800 2,050 3,600 310 14,750 2040 Gap 16,460 4,050 7,250 560 28,310 Source: ABS Census 2001, 2006 & 2011

0 10,000 20,000 30,000 40,000 50,000 60,000

Separate house

Semi-detached

Apartment

Existing Stock Demand (2011) Demand (2021) Demand (2031) Demand (2040)

Gap by 2040 (21,800 separate houses)

Gap by 2040 (170 units/apartments)

Gap by 2040 (1670 semi-detached houses)


The same comparison between supply and demand has been produced for the high and low population scenarios. These are shown in Table 24 for the high scenario and Table 25 for the low scenario. Reflecting a higher demand for dwellings, a gap of approximately 36,880 dwellings is identified in the high scenario by 2040, resulting from higher demand for dwellings driven by stronger population growth. By 2040, a forecast gap of 21,500 dwellings is identified in the low scenario.

TAB LE 24. HO USING SUPPLY AND DE MAND, HIG H SCENARIO


2011 Supply 34,340 2,510 3,250 230 40,330 2011 Demand 32,720 2,340 2,990 230 38,280 2021 Demand 40,210 3,510 3,660 290 47,670 2031 Demand 48,930 5,220 4,220 350 58,720 2040 Demand 61,390 7,970 5,360 440 75,160 2011 Gap - - - - - 2021 Gap 7,620 1,130 580 70 9,390 2031 Gap 16,340 2,840 1,140 130 20,440 2040 Gap 28,800 5,590 2,280 220 36,880 Source: ABS Census 2001, 2006 & 2011

TAB LE 25. HO USING SUPPLY AND DE MAND, LOW SCENARIO


2011 Supply 34,340 2,510 3,250 230 40,330

2011 Demand 32,720 2,340 2,990 230 38,280 2021 Demand 36,600 3,190 3,340 260 43,390 2031 Demand 40,440 4,300 3,480 280 48,500 2040 Demand 48,830 6,340 4,260 350 59,780

2011 Gap - - - - - 2021 Gap 4,010 810 260 40 5,110 2031 Gap 7,850 1,920 400 60 10,220 2040 Gap 16,240 3,960 1,180 130 21,500 Source: ABS Census 2001, 2006 & 2011

In summary, by 2040, between 21,500 and 36,880 dwellings will be required to close the gap between current stock and forecast dwelling demand. Given the current base case population forecasts, an additional 28,310 dwellings will be required to close the gap. Through a range of factors housing demand is increasingly shifting away from a homogenous (separate house) offer to a more diverse range of housing requirements. Household/family structures are becoming increasingly varied, with increases in; broken families; couples delaying having children; retirees; lone persons; and group household types. All these groups have quite different requirements which often don’t align with the traditional ‘couple with children’ housing requirement. In addition, the economy is transitioning toward a more service orientated base with an increasing need for skilled professionals to drive economic growth. This economic shift impacts on workforce locational preferences and pushed demand for housing toward more accessible larger urban centres where people can be close to deep diverse employment/economic markets. As a result we see between 20-40 per cent of the future housing demand likely to be for smaller dwelling types (i.e. semi-detached and units). This highlights the importance of meeting the forecast demand through a more diverse range of housing options. This can be achieved through ensuring that residential infill development opportunities, such as those identified in the Ballarat Residential Infill Opportunities Study, are realised. Also through more diverse housing options provided in new growth areas developments.


7.2 Future demand aligned with planned supply

Projected housing demand has been aligned with greenfield supply estimates to determine how many years this represents for the City of Ballarat. A qualitative assessment of how this supply aligns with dwelling type requirements for the City is also provided. The analysis assumes a future Greenfield supply of 20,739 lots based on those without significant constraints (as projected in the Residential Land Supply Review and summarised in Section 3.2). Demand is based on the number of additional dwellings required (i.e. housing gap) under each scenario (as discussed in Section 7.1 above). A series of possible development scenarios are presented which assumes between 50 – 100 per cent of the housing demand is realised in greenfield locations. Based on the mix of housing types demanded13 and insights from local industry experts identified in the Land Supply Review14 the most likely, and preferred, development scenario would involve 70 per cent of housing demand being realised in greenfield locations. Figure 28, Figure 29 and Figure 30 presents the alignment of broadhectare lot supply (red line) with housing demand under the three scenarios (base, high and low) and development scenarios.

F IGURE 38. HO USING DE MAND (BASE CASE ) AND BROADHE CTARE SUPPLY

Source: Hill PDA, 2013, SGS Economics and Planning

13

SGS identified between 20-40 per cent of the future housing demand is likely to be for smaller dwelling types (i.e. semi-detached

and units) 14

Hill PDA identified that local industry experts estimated that the City’s market has the capacity to absorb approximately 750 lots

per annum, comprising 500-550 Greenfield lots and 200-250 infill lots. This represents a 70:30 split between greenfield and infill

locations.

6,970

14,750

28,310

7,4799,049

17,064

20,50420,732

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

2013 2021 2031 2040

Dw

elli

ngs

100% 90% 80% 70%

60% 50% Demand (Base case) Supply (0-3 yrs)

Supply (few constr') Supply (mod constr') Supply (major constr') Supply (sig constr')


F IGURE 39. HO USING DE MAND (HIG H SCE NARIO ) AND BRO ADHECTARE S UPPLY


F IGURE 40. HO USING DE MAND (LO W SCE NARIO ) AND BRO ADH ECTARE SUPPLY


0

9,390

20,440

36,880

7,479 9,049

17,064

20,504 20,732

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

2013 2021 2031 2040

Dw

elli

ngs

100% 90% 80% 70%

60% 50% Demand (High) Supply (0-3 yrs)


5,11010,220

21,500

7,4799,049

17,064

20,50420,732

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

2013 2021 2031 2040

Dw

elli

ngs

100% 90% 80% 70%

60% 50% Demand (Low) Supply (0-3 yrs)



This alignment provides an indication as to how many years of greenfield land supply has been identified in the City of Ballarat (see Table 26). Under the Base Case and with 70 per cent development occurring in greenfield locations there is estimated to be approximately 25-30 years of supply. Under the low growth scenario, there is estimated to be at least 27 years of land supply under all of the development scenarios. Under the high scenario with 100 per cent development occurring in greenfield locations supply is expected to run out by 2031 (18 years). However, under the 50 per cent development scenario the supply will extend beyond 2040 (27+ years).

TAB LE 26. HO USING DE MAND AND G RE ENFIE LD L AND SUPPLY

Percentage demand met from Greenfield supply

100% 90% 80% 70% 60% 50%

Base case/ Alternative1

21 years 23 years 25 years 27 years 27+ years 27+ years

High scenario 18 years 19 years 20 years 22 years 25 years 27+ years

Low scenario 26 years 27+ years 27+ years 27+ years 27+ years 27+ years

Source: Hill PDA, 2013, SGS Economics and Planning 1 The alternative scenario matches the base case scenario as total dwellings, not dwelling mix, have been used.

While the analysis indicates that the City has a substantial Greenfield land supply, it is valuable to consider whether the type of dwellings supplied in these Greenfield locations are likely to match the projected demand for different dwelling types across the whole City. The types of dwellings typically delivered in greenfield developments comprise of three to four bedroom, detached houses. Which, still a dominate component of future demand, is declining as a proportion of future dwelling needs. Local policy supports diversity of housing products in growth areas and encourages flexibility in sub-division. Likewise, affordable housing is promoted through the creation of small lots, a diversity of housing types and medium density housing in appropriate locations. However, as policy does not set density or dwelling mix requirements specifically, the provision of a diversity of housing within growth area largely rests with the developer. Developer interests are primarily to develop the most financially feasible type of housing product, which often results in a largely homogenous housing product that in isolation may not align with the broader needs of the community. Conversely, infill development is typically higher density, associated with attached dwellings, such as townhouses, and units/apartments. The market segments which are expected to take part in infill development include students, investors, medical workers, young professionals, first home buyers and older residents who are down-sizing homes. All these market segments are anticipated to grow into the future. The Ballarat Residential Infill Opportunities Study (2009) identifies a considerable number of infill sites (87 sites) in Ballarat, representing a developable land area of 152 hectares. However, there are many constraints to infill development within the City of Ballarat that have the ability to impact the delivery. Identified constraints to infill development within the City include access to shop-top spaces, buffers around scattered industrial zones, mining leases and infrastructure, planned laneways, heritage overlays and other restrictive covenants such as covenants restricting development of social or affordable housing on new development sites. These two key sources of future housing supply both play an important, and complementary, role in the Ballarat housing market. Based on this needs assessment a 70:30 split between greenfield and infill development should provide the right mix of housing types while also meeting future demand requirements across the City of Ballarat. With significant greenfield supply identified (27+ years) the challenge for local government will be supporting housing diversity in these areas and ensuring good accessibility and the timely delivery of supporting infrastructure. Infill development opportunities throughout the City will provide a greater diversity of housing types in accessible locations. A focus on ensuring that land identified for infill


development can be easily developed and is able to reaches its potential will be critical to ensure this component of supply is realised. To ensure the City Ballarat encourages an efficient and affordable housing market which aligns with the needs of its residents it will need to realising the development potential in both Greenfield and infill locations. Council should work to minimise identified constraints to development to ensure an efficient housing market can operate.


Contact us CANBERRA

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