Sydney’s property market is increasingly driving the city’s key workers to live in areas such as the Illawarra, resulting in them commuting sizeable distances to work.
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Teachers Mutual Bank this week released a report investigating the impact of Sydney’s housing affordability crisis on the city’s key workers, and in turn its emergency and essential services.
The Key Worker Housing Affordability in Sydney study indicates that Sydney’s property market is pricing the city’s teachers, firefighters, nurses, police, ambulance drivers and paramedics out of metropolitan areas, resulting in some living hours away from their workplaces.
The study was undertaken by the University of Sydney’s Urban Housing Lab.
The report found that in the 10 years leading up to 2016, key areas in Sydney lost up to 20 per cent of teachers, nurses, policy and emergency service workers to outer and regional areas.
Sydney’s Inner South West (-14.6 per cent), Inner West (-11.3 per cent), Eastern suburbs (-15.2 per cent), Ryde (-14.2 per cent) and Parramatta (-21.4 per cent) all experienced a net loss of key workers.
Meanwhile, the Illawarra (+10.5 per cent), Southern Highlands (+17 per cent) and Hunter Valley (+13.6 per cent) all had net gains.
Despite reports of Sydney’s housing market cooling, Teachers Mutual Bank CEO Steve James said key workers’ hip pockets are still under serious pressure.
“Any so-called cooling of the housing market has not trickled down to prices in the range that key workers such as teachers, ambulance drivers, firefighters, paramedics and police officers can afford,” he said.
“While a slight drop in prices in some areas can be factored in, it’s a drop in the ocean for the key workers who protect and support our city. They still can’t afford to live within 100km of where they work.
“Longer commute times, especially in private vehicles, lead to significantly higher financial costs and serious social consequences for key workers and their families, disrupting work-life balance and impacting their lifestyle.
“Critically, lengthy commute times are also associated with lower rates of workforce participation.”
The report says between 2003 and 2016, the median price of established homes in Sydney more than doubled from $400,000 to about $900,000 - beyond the reach of many key workers, especially those who are single.
The report also says soaring rents have heightened the crisis.
It also found that a Senior Constable police officer on a single income can only afford to buy in five of 17 Outer Sydney LGAs, of which the closest to the city are Penrith and Campbelltown.
Beyond Sydney’s Outer LGAs, a Senior Constable can only afford to buy in the Blue Mountains, Gosford, Wyong, Wollongong, Shellharbour, Cessnock, Lake Macquarie, Newcastle, Port Stephens and Maitland.
The report also looks at potential solutions that can be implemented to help key workers buy their own homes both close to their place of work and their established support networks.
These include a shared equity model allowing key workers to buy up to 75 per cent of the property’s value, reducing deposit requirements to between five and 10 per cent; reducing development and/or construction costs and passing savings on to eligible purchasers; securing alternative development and financing models; and mandating that 20 per cent of dwellings in all major new housing developments are affordable to moderate income earners, including key workers.