THE Gold Coast risks losing moderate and lower income workers as housing affordability continues to outstrip wages.
A recently released Master Builders report showed the Gold Coast was the second least affordable region for housing in South East Queensland behind Brisbane.
Gold Coast Urban Development Institute of Australia president Col Dutton, says affordability had traditionally been an issue in resource-rich areas in North Queensland and Western Australia with those towns having difficulty in retaining moderate and lower income workers. Now it’s a Gold Coast problem too.
“The Gold Coast runs the risk of a similar trend because delivering affordable housing is extremely difficult at the moment,” says Dutton.
“Moderate and lower income workers fulfill vital roles in the city’s engine, which will come to a grinding halt if they move elsewhere.’’
A Midwood report shows the average house price is now $575,739 – out of reach for the average wage earner.
According to the Australian Bureau of Statistics, the average wage in Queensland in 2007 was $53,732 pa. This means the average worker would need to save an entire wage for more than a decade just to get a foot in the door.
The Demographer Bernard Salt, says the Gold Coast needs more three bedroom, brick veneer housing.
“The real threat is affordability,” says Salt.
“Melbourne is a city that listens to its residential market, (but) the Gold Coast does not have a Werribee (average price $333,000).”
The median land price for the year up until September 2009, according to the Real Estate Institute of Queensland (REIQ) was $235,000 making the prospect of building a new home a tough order for many, especially those looking to enter the property market.
The report showed the Gold Coast had a median house price-to-household income ratio of 8.6 – anything above 3 is considered unaffordable by international standards.
The Master Builders report echoes the Sixth Annual Demographia International Housing Affordability Survey: 2010 report that showed the Gold Coast was the fourth least affordable area to buy.
The report, which compares median house prices against median household incomes showed the Gold Coast was less affordable than Honolulu (6), London (14) and San Francisco (16).
Dutton is calling for roundtable action to bring long-term sustainability and affordability to home ownership on the Gold Coast.
“The First Home Buyer Boost has been scaled back and the demand for housing cannot be sustained because of the chronic shortage of land on the Gold Coast. And the backdrop to this equation is the high infrastructure charges levied on new Gold Coast houses which are footed by the buyer,” he says.
Three separate reports canvassed by local government and industry bodies in 2009 examined infrastructure charges across six regions.
Excluding Gold Coast City Council’s Temporary Local Planning Instrument, the combined average of reports showed greenfield charges in Coomera were $31,995, whereas the average across the six regions for a similar homesite was $23,946.
“Governments of all levels and business need to work collaboratively to address these issues now. Failure to address housing affordability on the Gold Coast is economically and socially unsustainable,” says Dutton.
An affordable housing summit involving industry groups will be held at Bond University on February 5.
Get our daily business news
Sign up to our free email news updates.