The Dog’s Bollocks

Truth is like a dog’s bollocks – pretty obvious if you care to look.

Rich coastal ghettos – a triumph of the market over planning

The AgeA report by the Victorian Coastal Council last week found that Lorne was unable to cope with further development – it has become a victim of its popularity. as the town rapidly becomes a holiday house enclave for multi-millionaires, the local population which provides town services is dwindling to the point where service sector workers cannot afford to live in the town.

Lorne Community Association president Peter Spring said the town’s population had dropped by 11% between 2001 and 2006, with the number of full-time residents aged under 50 falling by more than 20%. While Lorne’s median house price surged by 25% to $850,000 over the past year, almost 75% of its 1600 houses are only occupied part-time.

“Every single business in town is looking for staff because it’s become impossible for young working families to afford a house around here.

“There’s a view around town that something will only be done when holiday home owners can’t get a latte on the weekend.” Owner of the local bakery Loukas Leontiades has been forced to close for the past three months because he has been unable to attract staff.

“Why would people come here over winter, when there’s so much other work around?” Mr Leontiades said.

While Lorne has always been a popular destination for well-to-do holiday makers (including Mark Twain) until a generation ago it remained a small fishing community where working class people came in droves for an affordable summer holiday. A campsite in town now costs more than $300 per week prime time and even a modest house or studio apartment will set you back $2-3000 a week at the bottom end of the market.

Service workers – in hospitality, education, health, police – have tended to come from local families who have been here for generations or bought in more than 20 years ago and students whose families have holiday houses. At the corporate end of hospitality, cleaners are now brought in by out of town contractors. The local supermarket buses in immigrants on temporary worker visas from communities an hour further up the coast.

Every summer, the sleepy seaside town is transformed into a thriving playground, where a coffee can take 30 minutes, punters form a scrum at the aptly named Bottom Bar of the Lorne Hotel and finding a car park is virtually impossible.

During the Christmas New Year period the streets are packed with what one well-known local calls Grammar Girls (and Boys) and their parents moving endlessly between beach, cafe, bar and South Yarra styled clothing boutiques, all with an overinflated sense of self-importance and an exaggerated air of entitlement – with BMW drivers arguing the toss over the price of a coffee or a minimum serve of chips. The streets are clogged with every conceivable imported luxury car whose drivers have abandoned any sense of road rules, consideration for others, or common courtesy. Summer in Lorne is a perfect manifestation of greed-and-selfishness-is-good free-market narcissism. If you really want to make a statement with your car, forget budget Beamers and Mercs – they’re as common as muck. Better try a Bentley, Ferrari or Lamborghini. Or just get dropped off by a chopper.

Yet, for almost 10 months of the year, small businesses along the promenade are unable to find staff, there is no long-term rental accommodation and organisations such as the Country Fire Authority struggle to find volunteers. There was summit recently in Lorne to discuss the issue of affordable housing for workers. A few years ago some land was subdivided and released under an affordable housing scheme, with most of it developed and sold off at premium prices a few years later.

So what is the free-market solution to all this? Or do towns like Lorne need interventionist policies. Left to market forces the cost of services will escalate and businesses dwindle. Factor in peak-oil and the value of real estate will inevitably fall – unfortunately long after the death of the local community who make the town so desirable and livable.

Victorian Coastal Council president and Surf Coast councillor Libby Mears recognises there is a problem. “The Lorne community is expressing a level of distress … and inequity between permanent and non-permanent residents is causing some real tension,” she said.

Cr Mears said higher rates on holiday homes was one option that would be considered by council, but conceded it would be unpopular with owners.

She said unoccupied holiday homes needed to be used more effectively and the council would need to think laterally to resolve the affordability crisis. “Maybe local government has a role in how we rate properties, or alternatively, how do we provide incentives to encourage longer-term rentals?” Cr Mears said.

The National Sea Change Taskforce, made up of 70 coastal councils around Australia, has proposed a 50% “sustainability surcharge” on absentee owners based on their rate bill.

The plan reflects a groundswell of concern in coastal councils and communities about the pressures of tourism and national residential development.

Given the history of the Surf Coast Shire, I suspect that the vacant holiday house rate surcharge would end up being spent on improving the street scape amenity of Torquay, its home town, rather than facilitating an affordable housing solution in Lorne.

If you have any bright ideas, please let me know.

Filed under: Economics, Town Planning

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