Government action may be required to unlock affordable housing supply in rural and regional markets, according to new research from AHURI.
The study, conducted by researchers from the University of South Australia, University of Adelaide, and Royal Melbourne Institute of Technology, delved into the unique challenges these areas face.
The research, titled Disruption in regional housing: Policy responses for more resilient markets, found that rural and regional housing markets face more adverse conditions compared to metropolitan areas.
Factors like smaller market scales, local labour shortages, limited builders, and higher costs due to distance from suppliers are significant barriers.
See LinkedIn post here.
“Our research surveyed regional and rural local governments and not-for-profit housing providers to understand the trends impacting regional development,” said Andrew Beer (pictured) from the University of South Australia.
“Sixty per cent of respondents identified resource impediments, such as workforce shortages and shortages of land for development, as the top barrier to delivering affordable housing supply in their areas.”
The greatest challenge identified was the shortage of a skilled workforce.
The research suggested that a guaranteed program of ongoing work and new builds, potentially funded through the Commonwealth government’s Housing Affordability Future Fund, could attract and retain labour.
“Limited support from state and federal governments was also considered a major barrier by a similar number of respondents,” Beer said.
The AHURI study also found that different types of regions, such as stalled, volatile, stable, coastal, expensive, or growing, require tailored housing solutions.
“One size fits all” approaches won’t work as housing markets in these regions become increasingly different over time. The research emphasised that housing solutions suitable for one area might be inappropriate or even counterproductive in another.
An expert panel highlighted the crucial role of government in developing stronger supply chains for rural and regional housing.
They advocated for a national urban and regional strategy to provide certainty for private investment and potential state and federal support.
“Overall, we found that relatively small public sector interventions are likely to deliver substantial benefits to future generations of regional and rural residents,” Beer said.
The AHURI research suggested that accessing the Housing Affordability Future Fund could help regional housing providers build additional dwellings, creating a secure pipeline of work for builders.
However, it warned that short-term actions may worsen existing challenges.
“There is also a role for direct government investment in these housing markets, particularly for social housing,” itsaid.
Get the hottest and freshest mortgage news delivered right into your inbox. Subscribe now to our FREE daily newsletter.
