Grounded advocates affordable housing reforms in Victoria

Amid rising housing affordability challenges in Victoria, Grounded, a community-focused organisation, has submitted a proposal to the state’s “Big Ideas for Victoria’s Future” inquiry. The submission emphasizes “innovative, community-driven solutions that can deliver long-term affordability, resilience, and sustainability to regional and urban areas.”

A key element of Grounded’s proposal is the introduction of Community Land Trusts (CLTs), which present a unique approach to homeownership. CLTs work by separating land ownership from housing ownership, allowing communities to retain control of land and ensure long-term affordability. By capturing public subsidies and the increase in land value created by community-driven growth, CLTs reinvest these funds to reduce housing costs and expand affordable housing stock.

In a market like Victoria’s, where land prices continue to surge, CLTs could offer significant relief, said Grounded in its report. According to the organization, CLTs can reduce the deposit burden by as much as 60%, making homeownership more accessible. Through a resale formula that links housing prices to local wage growth, affordability can be locked in for generations, preventing price inflation that has traditionally priced many out of the housing market.

Policy reforms to streamline affordable housing

Alongside CLTs, Grounded is advocating for several policy reforms aimed at streamlining the development of affordable housing in Victoria. These proposals include:

• Simplifying the Section 173 process: Grounded said this would reduce bureaucratic hurdles for landholders committed to developing affordable housing.
• Supporting community-led exception sites: This initiative, Grounded highlighted, encourages landholders to donate property specifically for affordable housing projects, bypassing traditional market pressures.
• Incorporating mandatory inclusion policies: Grounded suggests requiring affordable housing in all new developments, ensuring that affordability remains a priority across the state.

Such reforms, Grounded said, would empower local councils and communities to take greater control of housing development, particularly in regional areas where affordable housing is scarce.

Addressing rural challenges with flexible planning

Grounded also emphasised the need for more flexible planning laws, particularly in rural areas where the housing shortage is most acute. By allowing smaller landholders to subdivide their properties for affordable housing developments, Victoria can address both housing shortages and the need for climate resilience, Grounded noted. This planning flexibility could encourage developments that not only solve housing issues but also help communities adapt to environmental challenges.

As Victoria faces an unprecedented housing crisis, Grounded’s proposals seek to create a housing ecosystem that prioritizes long-term affordability and sustainability, the report said.

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