Building private housing on public housing estates – Victoria’s Public housing renewal program

The Victorian Government is continuing its policy of selling land in public housing estates to developers so they can build housing for the private market. But according to The Age, some councils aren’t happy (Opposition mounts to plan for developer deals on city’s public housing estates):

Plans to sell off public housing land at nine sites across Melbourne to private developers have been opposed by six of the eight Melbourne councils where residents are affected. The Andrews government is fast-tracking plans to sell the nine sites, in some of the city’s most exclusive locations: Brighton, Hawthorn, Clifton Hill, Ascot Vale, North Melbourne, Flemington, Brunswick West, Northcote and Heidelberg West.

Developers who succeed in buying a site off the government will have to rebuild the existing public housing – with at least 10 per cent additional dwellings for the poor.

There’re the usual quotes in the paper’s report about government lining the pockets of greedy developers, but is there a more sensible motive here? Could the $185 million Public housing renewal program be a good idea? Or are councils right to oppose it?

Based on the information provided by the paper, the main benefits claimed for the Government’s policy are:

  • It funds the rebuilding of end-of-life public housing units on the estates
  • It funds an increase in the total stock of social housing across the estates
  • It promotes social mix by socioeconomic status
  • It increases the total stock of private dwellings in the inner suburbs.

Opponents of the policy, however, claim that:

  • It privatises publicly owned land with no benefit for public housing residents
  • It creates excessively high population densities on the estates
  • Social mix doesn’t happen because the private and public residents are in separate buildings.

Critics say the Government should instead be directly funding more social housing. I agree with the principle of building more social housing rather than being distracted by tokenistic policies like inclusive zoning, but there’re two important issues to consider in this case:

First, the Victorian Government has limited funding that must cover a range of worthy expenditure priorities e.g. public transport, education, health. It also has limited avenues to raise revenue. In the absence of the Federal Government providing more money for social housing, selling the land is a way of covering the cost of renewing existing public housing units, as well as adding to the stock, without taking funds away from other priority purposes.

Second, there’s limited scope to increase the number of public housing units on these sites. There’s a large and compelling body of experience showing that spatially concentrating disadvantaged residents amplifies dysfunction and leads to poorer outcomes. Putting a lot more public housing residents together is not a good idea (see also Does place matter for the life prospects of children?).

I don’t think there’s much to the “excessive density” objection; it’s a politicking tactic (see Is “denser than Singapore” too dense for Sydney?). Developers will have to sell to private buyers at densities that will be acceptable to them, suggesting that what gets built will be fine for both public and private residents. These estates are mostly in the inner suburbs where increases in density make a lot of sense. Many Melburnians already choose to live at much higher densities than will be provided on these estates.

However the criticism that social mix won’t provide benefits is probably largely true (What can planners do about socio-economic polarisation?). It’s likely there’ll be separate private and public buildings because that’s what buyers want. In that sense it won’t be that different to the separation that currently exists between estates and surrounding middle class housing. Nor will buyers mix a lot with public housing residents. Again, that’s the status quo; many middle class inner city residents actively avoid sending their children to schools attended by public housing residents (see What to do about schools and “rich switch”?).

So, while social mix should be heavily discounted as a benefit, it won’t cause serious problems either. It seems to me the key benefit of the policy is rebuilding aging, high-maintenance public housing units and the construction of some additional social housing units. It does that without intensifying the issues of concentrated disadvantage and provides an increase in market housing supply. Unless someone can devise a better way of turning estate land into revenue that can be spent on social housing, or can extract unprecedented sums for new construction from the Commonwealth, this looks like a real improvement on the status quo.