More than 80,000 empty properties in Melbourne: Prosper Australia report

More than 80,000 properties in Melbourne may be lying vacant, says a report by a land policy lobby group.

The annual 2015 Speculative Vacancy Report by Prosper Australia Prosper says housing is one of our least efficiently used resources.

It was up on the 64,000 in the 2014 report.

It analyses vacancy through water consumption of properties over 12 months, and Speculative Vacancies (SVs) are assessed as properties with abnormally low water usage of less than 50 litres per day (LpD) over a 12-month period, allowing for leaks and property maintenance.

The average per capita water usage in Melbourne over 2014 was 160 LpD.

Melbourne’s three main metropolitan water retailers, City West Water (CWW), South East Water (SEW), and Yarra Valley Water (YVW) made their data available for this report.

“The incentives for property speculators to hold prime locations empty is an affront to anyone locked out of housing. The findings prove we do not have a housing supply crisis, we are literally locked out” said Karl Fitzgerald, Prosper Australia’s project director.

“With capital gains accelerating in 2014, the Speculative Vacancy rate rose 22% for properties using less than 50 litres of water per day. According to our most conservative measure, those using zero litres of water increased by a 70%."

Carlton ranked top of the list, with a 7.6 per cent 0LpD SV rate over calendar 2014 and an overall 14.5 percent using less than the 50LpD threshold. Melbourne CBD was at second place on the list in the report.

A total of 1,707,140 residential properties across 254 postcodes over the calendar year 2014 were analysed for the report. Data indicated 82,724, or 4.8 per cent of Melbourne’s total housing stock appeared to be vacant over this period, having consumed less than 50 LpD. No water was consumed in 24,872 dwellings - therefore being demonstrably unoccupied.

If just those residential properties consuming 0LpD were placed onto the market for rent, this would increase Melbourne’s actual vacancy rate to 8.3 percent, it said.

“This is clear evidence land is being hoarded for profit. Up to 18.9% of all investment properties lie empty. This report demonstrates over eight years that hoarding is magnified in periods of increased speculation,” Fitzgerald said.

The report concludes that with 4.8 percent of Melbourne’s houses showing under-utilisation, there is no housing supply crisis. Rather, rising prices indicate significant distortions created by policies supporting rent-seeking behaviour, it says.