Families on the Fringe – Affordability or Cycle?

On 17/10/2011, The Age reported, in what seems to be an ongoing series on housing (un)affordability, that families can no longer afford to purchase housing in the inner city. See the article “Housing Costs pushing families to the fringe”. This was based on a recent study by the Australian Housing and Urban Research Institute (AHURI). The statement:

“These household affordability differentials appear to be shaping a new urban and social form, with families and detached housing on the fringe and non-family households in inner-city and middle-ring locations” is interesting, because all our research and observation here at .id shows that this is far from a new form!

We’ve written quite a lot about this.

See also Ivan’s article “Is there a market for family style apartment living in Australia?” (View article here)

And Johnny’s recent article on suburb life cycles – A Tale of Two Suburbs.

The trend towards inner cities as the domain of the young and single, while families live on the urban fringe is very well-established, and while there may be some component of affordability to it, primarily it is about space, age of housing and the role and function of those areas. This has been happening at least since the motor car became universal after World War II. At that time families moved out to fringe suburbs such as Glen Waverley, Moorabbin, Bankstown and Ryde – what we would now know as middle ring suburbs – to buy their block of land and build their first home.

These suburbs are now well into their second life cycle, with families being attracted back to the areas, after a period of significant ageing and population loss. See Johnny’s article for more details. His article uses Wantirna as an example, which was built in the 1970s and 80s.

The statement in the article makes it sound like our inner cities have just recently emptied of all their families due to housing affordability, but in fact it happened decades ago. Looking at profile.id for an inner city area shows that it is the domain of young adults, not families. Here is the age profile for the City of Sydney. Note the very low proportion of children!

The age structure in inner city Melbourne is similar. See this chart for the City of Port Phillip (St Kilda, Port Melbourne etc.).

Anywhere with a high proportion of flats and apartments tends to have low proportions of families, and has for some time. Since WWII, the main parts of the inner cities which did feature families in significant numbers were the public housing areas. Until recently, public housing was a major tenure type in inner city areas, providing options for low income families and older households as well.

Going right back to 1991, now 20 years ago, shows that the City of Sydney had 14.4% of its population aged under 18, compared to 26.9% national average. The proportion has gone down, since then, mainly due to the steady growth of other age groups, and no growth in public housing. In Port Phillip the population under 18 was 13.7%, half the national average.

In both these LGAs, public housing has declined substantially. In Sydney, in 2006, public housing made up 8.0% of dwellings, compared to a very substantial 19.3% in 1991. The actual number of units fell by over 1,600 in that time, but the proportion fell faster, due to massive dwelling growth in private housing. Our studies for the City of Sydney show that the remaining public housing is a refuge for families with teenage children – the only place with significant numbers of teenagers in the city. The story in Port Phillip is similar, but not as dramatic, with a drop in public housing from 7.0% in 1991 to 4.5% in 2006.

Housing in 1991 was generally more affordable than it is now, but families have never wanted to live in the inner city in large numbers. In fact if anything there is now a small trend back towards the city for those families who can afford it. Port Phillip had a small growth in children aged 0-4 between 2001 and 2006. Housing in the inner cities mainly consists of smaller apartments, and has always been primarily smaller dwellings on smaller blocks, mainly 1-2 bedrooms (think Victorian terraces, small worker cottages etc), and families seek space as well as affordability, so, since car transport has been readily accessible, they have always moved out to the fringe. Until developers put in affordable family-size apartments this is not likely to change, and even then it will probably only provide an option for a small number of families in the city.

There are exceptions to this, such as Bankstown, which was referred to in Ivan’s blog – large numbers of families live in the small apartments in the suburban centre here – this is influenced by cultural trends as well as the greater affordability of this area. And Bankstown isn’t usually considered inner city.

So the role and function of the inner city for decades now has been to provide accommodation to young singles and couples, and increasingly, only affluent population, with public housing playing less and less of a role over time.

In contrast, growth areas on the fringe are the domain of young families. The National Growth Areas Alliance has a community profile with .id. The NGAA consists of 24 of the fastest growing urban fringe LGAs around the nation, so this makes it easy to compare the characteristics of these locations as a whole. This shows another way in which profile.id can group areas together – not by geography but by a shared characteristic.

The profile shows lots of children in these areas when taken in total (despite the fact that there are some older suburbs with lower proportions in some of the LGAs).

In 2006, the proportion of children under 18 in the NGAA was 28.5%, compared to a national average of 23.9% . Going back to 1991 (when some of these areas were still beyond the urban fringe), they made up 32.5% of the NGAA and 26.9% of Australia.

What the AHURI report seems to miss is that suburbs do grow and change over time. The inner city areas were all once family suburbs, but not recently as the article suggests – in some cases you have to go back 100 years to find their family heyday! Families’ expectations change over time, and they have long sought newer, larger housing on the urban fringe. They also seek areas where they can buy a home – most accommodation in the inner suburbs is rental, and that which is still public housing has very long waiting lists. Even with the revival of inner city living, not everyone wants to live in the inner city! Nor are all jobs located there. In Melbourne, more than 70% of all employment is outside a 5km radius from the CBD.

Generally, our research shows that young people go to live in the inner suburbs (renting), and then move outwards, usually on the same side of the city, once they have children, upgrading their homes and commuting for work. Their children, when they leave home, either rent in the inner city or move to the new fringe to start their own families (often a combination of both, renting for a time, then moving out).

What is defined as urban fringe changes as the city grows. Some of the middle ring suburbs, which were fringe only 50 years ago, like Box Hill and Essendon (Vic), Dee Why (NSW) and Victoria Park (WA) are now taking on some characteristics of inner suburbs, with higher populations of young people – particularly if they’re close to a university. As the modern fringe suburbs grow and develop, they too will diversify their population, and go through the suburb life cycle, as described in Johnny’s blog – A Tale of Two Suburbs.

The housing form that is built in those areas can influence how responsive those suburbs can be to new changes – it is possible to build suburbs that accommodate changing urban patterns more easily – but that’s a subject for another blog.

.id is a team of demographers, population forecasters, spatial planners, urban economists, and data experts who use a unique combination of online tools and consulting to help governments and organisations understand their local areas. Access our free demographic resources here