Our findings mean that many homebuyers who are priced out of buying a home in the inner city will face long-term costs from purchasing and living in the middle and outer suburbs.
These findings have implications for individual homeowners, governments, and communities.
Beyond financial costs, living in the outer suburbs has economic, social, and environmental impacts. We estimate that the cost of environmental impact is 300 per cent higher because of the additional transport needs of outer-suburb buyers compared to their inner-suburb counterparts.
The economic costs of providing services and infrastructure to outer suburb houses are far greater. Servicing a two-bedroom house in the outer suburbs costs $22,300 per year, whereas a two-bedroom inner-suburb apartment costs $8,400.
Melbourne’s outer suburbs are rapidly growing. The population on Melbourne’s outskirts is expected to grow by one million people by 2056. These costs will only be compounded if the growth continues to be rolled out without the needed infrastructure, services and jobs.
