Your owners corporation in Melbourne, now and tomorrow
As a member, or potentially part of an owners corporation in Melbourne, what issues should you be aware of now and in the future?
One crucial reality of housing, accommodation and property investment you’re almost certainly aware of is that Melbourne is growing, and growing fast.
Whether or not you buy into the fabled rivalry between Victoria and New South Wales and their capitals cities, the raw numbers tell a fascinating story.
Melbourne to overtake Sydney
Australian Bureau of Statistics figures published in April predicted that Melbourne’s population will overtake Sydney’s by 2053. Some forecasters believe Melbourne’s ascendancy to Australia’s most populous city could come as soon as the end of the 2030s.
A Sydney Morning Herald report, also in April, contended that such predictions relied on demographic modelling. But it also conceded that Melbourne’s pre-eminence appeared inevitable given comparisons in historical growth rates over the last 40 years. In that time, Melbourne’s population increased by two thirds while Sydney’s grew only by half.
What then does this mean for Melbourne and for you?
Melbourne 2030 plan
The Victorian Government’s blueprint for urban development, Melbourne 2030, was first published in 2002 and is regularly updated.
The plan projects the addition of more than one million people to the population by around 2030. It estimates a growth of 620,000 households over the same period.
That means significant growth in the urban footprint of the city, although expansion is also linked to the main regional centres of Geelong, Ballarat and Bendigo. The plan also makes it clear that Melbourne receives a significant proportion of attention in policy, planning and funding for the future, as part of a wider plan for Victoria as a whole.
The blueprint cites nine ‘directions’ or preferred outcomes for the city, some of which will impact the nature and direction of our lifestyle and accommodation choices.
The nine directions are:
- A more compact city
- Better management of urban growth
- Networks with regional cities
- A more prosperous city
- A great place to be
- A fairer city
- A greener city
- Better transport links
- Better planning decisions
How will these demographic, infrastructure and policy directions affect people choosing to live in owners corporation and strata managed properties?
Melbourne the leader in high rise residential
Despite Melbourne’s population growth, and leadership over Sydney in new housing starts, Melbourne and much of Australia remains severely and chronically under-supplied. With trends in apartment living climbing, Melbourne has now emerged as the leader in high rise residential development.
Melbourne commercial property specialist, Paul Thornhill, says fears of an apartment glut have proved unfounded. Despite projections of 39,000 new apartments to be built over the next five years—the figure comes from Monash University’s Centre for Population and Urban Research—Thornhill says most indicators remain favourable.
Writing on realcommercial.com.au, he quotes Asher Judah, Deputy Executive Director of the Property Council of Australia: ‘With higher immigration and locally sourced population growth, we’re witnessing an evolution of Melbourne into a more global city.
“Demand for inner city property is multilayered, centred on the 800,000 people who work in the city and the three major universities located close to the CBD,” Judah said.
Thornhill says universities are playing a key role, attracting the fastest growing source of new residents, foreign students. Melbourne now has the third largest foreign born student population after New York and London.
Plentiful buyers and investors
Buyers have also been plentiful. Sixty eight percent of demand for city units has come from investors, with locals taking advantage of the 2007 changes to asset rules. The new regulations allow investors to use self-managed super funds (SMSFs) to secure an investment seen as less volatile than the share market, he said.
From Turnbull Cook’s perspective, the growth of Melbourne as a world city, and the long-term health of the apartment sector as source of local and foreign investment spell good news for the future of owners corporations.
Ben Willox is Managing Director at Turnbull Cook, one of Melbourne’s oldest and most experienced owners corporation service provider. For a free downloadable e-report on the top tips for finding and hiring a great OC manager, visit turnbullcook1.wpengine.com/top10tips