Spinifex is an opinion column. If you would like to contribute, contact us to ask for a detailed brief.
Shifting more growth into established areas could save Victoria around $41 billion by 2056, compared with the status quo of continuing to rely on greenfield areas.
Where you live increasingly determines how exposed you are to rising fuel prices.
The current fuel crisis lays bare a deeper issue: the way our cities are planned is shaping who is most vulnerable to economic shocks.
Like the COVID19 pandemic, this latest international crisis exposes the social and economic inequalities embedded within Australian cities. More than ever, urban planning must be critical in leading the shift toward more compact, accessible communities where people can meet everyday needs without relying on the private car and being exposed to the financial vulnerability it creates.
While these spatial inequalities play out across Australian cities, Melbourne provides a clear case study about how this plays out in practice.
The price of liveability
A range of organisations attempt to measure and rank the liveability of the places where we live. While the suburbs that come out on top may vary, they share one thing in common: they are inner city suburbs, established before car dependence became the norm.
The Australian Urban Observatory, developed at RMIT University, publishes liveability scores for Australian cities based on a range of indicators, including access to health services, public transport and open space.
East Melbourne, Fitzroy North, and Kensington rank among the most liveable suburbs in Melbourne, and the country. The median house price in East Melbourne is $2.4 million and in Fitzroy North it is almost $1.8 million, compared with just over $650,000 in Bonnie Brook – one of Melbourne’s least liveable suburbs.
That price difference reflects more than housing demand, it captures the locational advantages of access to jobs, services and transport. While the available housing is highly valued, residents of disconnected outer suburbs confront hidden financial burdens and cost vulnerabilities. What looks like affordable housing on the fringe often comes with higher ongoing costs in fuel, time, and access to jobs.
A key part of the challenge is that not enough housing has been delivered in well-located areas close to jobs, services and transport, constraining access to opportunity.
Geography of disadvantage
People unable to afford the price premium of more liveable suburbs are pushed toward areas developed in the car dominated era, where housing appears more affordable. While the outward – rather than upward – growth of Australian cities has helped deliver cheaper housing on the urban fringe, it has also locked many households into ongoing costs that create long term financial vulnerability.
The large geographic footprint of our cities means residents of outer suburbs face longer commuting distances and greater car dependence.
In the City of Whittlesea – one of Australia’s fastest growing municipalities in Melbourne’s outer north – 63 per cent of residents travel outside the municipality for work, and 60 per cent of households own two or more cars to access jobs, education, healthcare and essential services. By contrast, only 20 per cent of households in East Melbourne own two or more cars, reflecting close access to daily needs and high quality public transport, (based on ABS Census of Population and Housing 2021).
As a result, households that are already more economically secure are further insulated from rising fuel prices and broader economic shocks.
This dynamic is reflected in RMIT University’s VAMPIRE index, which measures vulnerability to mortgage, fuel and inflation pressures.
The index consistently shows that outer, car dependent suburbs face the highest combined risks, with many Melbourne outer suburbs scoring up to 24 out of 26, compared with just four in North Fitzroy.
Households locked into high car ownership, long commutes and large mortgages – already affected by recent interest rate rises, with more in prospect – are therefore most exposed to escalating fuel prices. Together, these trends reveal a geography of disadvantage in Australian cities, shaped not only by income or housing costs, but by urban form and access to opportunity.
Strain on the public purse
The cost of outward urban growth is not borne by households alone but is also carried by the state and its taxpayers. Infrastructure Victoria highlights the cost to the state of keeping up with infrastructure delivery in greenfield areas.
The cost of delivering the new infrastructure required to support homes in growth areas, like transport, utilities and social infrastructure such as schools, hospitals and childcare facilities costs the government up to four times more than in established suburbs, according to a 2023 report from the Centre for International Economics prepared for Infrastructure Victoria.
Indeed, shifting more growth into established areas could save Victoria around $41 billion by 2056, compared with the status quo of continuing to rely on greenfield areas for growth.
Further, delays in delivering this infrastructure across growth areas entrenches car dependence from the beginning, with residents moving into new suburbs before services and facilities are available.
Better growth, not just more growth
Urban planners understand that continued outward urban growth is unsustainable, and the economic foundations that have enabled it are now under increasing strain. More compact, connected patterns of development reduce travel demand, strengthen resilience and limit exposure to cost shocks, but density done well does not occur by accident.
However, in many established areas, planning settings have not kept pace with the need to enable more housing in well-located locations. Transforming urban form requires investment in long term strategic planning and coordinated investment across all levels of government.
Increasing housing density in the right places also depends on better coordination with the delivery of transport infrastructure, schools, health services, open space, utilities and other essential amenities that allow communities to function and thrive.
Without this coordinated approach, efforts to boost housing supply or density risk overloading existing infrastructure, undermining liveability, sustainability and household budgets. Well managed urban growth therefore depends on aligning land use planning with infrastructure delivery, economic development and community services.
In a time of rising costs and global uncertainty, how we plan our cities is not just about growth or housing supply, it is about who benefits, who pays, and how resilient we are as a nation.