With plenty of work and an unemployment rate hovering around 3 per cent, the town of Ararat in western Victoria should be an attractive place to live.

Key points:

  • The Victorian Government is spending $5 million on four pilot projects to address housing shortages in regional areas needing more workers
  • Some pilot projects will help prepare land for private residential developments
  • A council CEO says the cost of rural housing developments has seen shortages of stock in some areas

However, Andrew Eastick, who was born and raised in Ararat, said there were not enough places to move into.

“We desperately need workers — from doctors to vets, down to farmhands … labourers … tradesmen … factory workers,” Mr Eastick said.

So few properties are available – to buy or rent – that one of Ararat’s major employers recently resorted to paying for 50 foreign workers to complete hotel quarantine, and bought a hotel to house them in.

The Victorian government, facing similar issues in other towns in the state, has allocated $5 million to four pilot projects that it was hoped could address worker shortages by freeing up accommodation.

In Ararat, the government is paying for “trunk infrastructure” — such as sewerage and stormwater — to kickstart a new residential development expected to one day house 317 people.

Mr Eastick — one of three landowners behind the development — said that, without the government funding, the land would “sit there for the next 20 years”.

An open field with a barbed wire fence in the foreground and a large branch of a tree in the background

Land to the east of Ararat is being prepared for a residential subdivision with funding from the Victorian government.(

ABC Ballarat: Christopher Testa

)

‘Partial market failure’

Much of regional Victoria has been experiencing a property boom since the COVID-19 pandemic began.

The Real Estate Institute of Victoria this week published figures showing properties in several country suburbs and towns were selling faster than they did even a year ago, and at some of the quickest rates over the past decade.

Ararat was one of the markets with the most movement.

REIV president Leah Calnan said councils needed to “cut red tape” and release land faster in response.

But Ararat Rural City Council chief executive Tim Harrison said, for communities such as his, the solution was “much more complex”.

“We, traditionally, had pretty low real estate prices in rural communities, which made it quite unattractive to developers who can get [higher] yields in other locations,” he said.

Dr Harrison said building trunk infrastructure for new subdivisions was “always a very expensive part that nobody pays any attention to”.

“We’ve got partial market failure and this kind of assistance from the government helps overcome that partial market failure,” he said.

A bearded male worker sits at a computer-driven machine in a large workshop

An Ararat company recently paid to bring in 50 workers from Samoa — and bought a hotel to house them.(

ABC News: Kate Stowell

)

Jobs to determine success

The government’s other three pilot projects include a program to connect tourism workers in the High Country with subsidised rentals, rezoning of land for residential development in the state’s south-west, and a horticulture worker accommodation initiative in Robinvale.

Victoria’s Regional Development Minister, Mary-Anne Thomas, said she would advocate for similar measures to be rolled out elsewhere, if the four pilot projects work well.

Portrait of Mary-Anne Thomas leaning against a wall. She is wearing a navy jacket over a white shirt

Regional Development Minister Mary-Anne Thomas says pilot projects will be judged on how many jobs are filled.(

Supplied: State Government of Victoria

)

Mr Eastick said his development, east of Ararat, would eventually create 160 lots, with lots ranging from 600 square metres to 10,000 sqm.

At least 30 to 35 homes are expected to hit the market by March 2022, he said. He said he believed plenty of tree-changers would be interested in a move to the Grampians region.

“They can live in inner-city Melbourne on small blocks, or they can come out to the bush and have a bit of land around them,” Mr Eastick said.

Dr Harrison said that even council was feeling the labour pinch.

“So there are some creative solutions but what we need is some more mainstream worker housing in town.”

State steps in as small towns face worker, housing shortages
Source:
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