Unless you're totally out of touch with reality, you'd know that Melbourne (and also pretty much the entirety of Australia) is currently experiencing a housing crisis. Amid increasing interest rates, rising inflation and a severe lack of affordable housing, more and more people are facing housing insecurity and financial pressure. It's a grim state of affairs. And now a new report has unveiled the cherry on top: there were 100,000 homes sitting unused and empty last year. If there was ever a time to utter your expletive of choice, it's now.
Prosper Australia, an independent not-for-profit that focuses on land waste and inequity, has just released its latest Speculative Vacancy report and uncovered some truly harrowing information. Through analysing water meter data to see how much each house used across metropolitan Melbourne between 2019 to 2023, the report revealed there were a staggering 97,861 vacant dwellings last year. The term "vacant" means either totally empty, or barely used – either using no water at all, or an extremely low amount. Of those vacant homes, 27,408 were completely empty and unused.
That equates to 1 in twenty homes in Melbourne being vacant. According to Prosper, this number of vacant homes is equivalent to two and a half years of new construction, which would be enough to house everyone on Victoria's public housing waitlist, twice over. The number of vacant homes has spiked in the last three years, with less than 70,000 recorded in 2019.
Prosper Australia director of research and policy Dr Tim Helm said it was "shocking" that so many homes had been left empty during a rental crisis.
"It speaks to the state of inequality that these numbers keep rising," says Dr Helm. "Bringing just a fraction of Melbourne’s vacant dwelling stock into use would improve access to housing.”
“Empty homes are important to address, but to boost housing supply we must also tackle land banking, which is too often ignored or downplayed. Both stem from the same incentives and tax system distortions.”
The Melbourne suburb that had the highest concentration of vacant homes in 2023 was Brunswick East, with 1,214 of houses left vacant, equating to 12.7 per cent of all properties in the suburb. Other hotspots for empty homes include the CBD, South Melbourne, Abbotsford, Southbank and Box Hill. The suburbs that had the biggest increase of vacant homes between 2019 to 2023 were the CBD with a 6.4 per cent increase, and Craigieburn, Donnybrook, Kalkallo, Mickleham and Roxburgh Park all had a 3.1 per cent rise.
So the situation is dire. But thankfully, the Victorian government is getting its act together to combat this issue, by making stricter rules on homes that are liable for the vacant residential land tax. From the start of next year, any home in Victoria left vacant for six months consecutively will be taxed at a rate of one per cent of the home's value, increasing by one per cent for each year of vacancy.
Read the full report from Prosper Australia here.
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