New worker housing begins as Lorne seeks long-term fix

CONSTRUCTION has begun on new affordable housing for workers in Lorne, but community groups and the Surf Coast Shire say longer-term measures are still needed to address the town’s housing shortage.

A Regional Worker Accommodation Fund grant from the Victorian government is supporting the construction of eight two-bedroom units in Erskine Avenue.

Under the program’s conditions, the homes must be reserved for Lorne Hotel staff for at least five years.

The shire declared a key worker accommodation crisis in Lorne in 2021, with many workers still unable to find housing close to their jobs.

Friends of Lorne is among the groups calling for changes to the program, arguing the worker-only requirement should be extended from five years to 20 years.

President Penny Hawe said allowing the homes to return to the private market after five years risked shifting the problem “temporarily into the future at considerable taxpayer cost”.

About 465 Lorne properties – roughly one quarter of the town’s housing stock – are listed on short-stay accommodation platforms such as Airbnb.

Friends of Lorne believes encouraging just 20 of those properties to become long-term rentals for two to three years would make a significant difference for the town’s essential and seasonal workers.

The housing shortage continues to affect essential services in the town. According to the Surf Coast Shire, only two of Lorne’s 29 teachers live locally.

The council says high land tax and holding costs are also encouraging some property owners to sell rather than offer long-term rentals, contributing to instability in the rental market.

In response, the shire has called on the Victorian government to trial a land tax exemption in Lorne, aimed at encouraging more long-term rentals for key workers.

Under the proposal, the owners of 20 properties would receive a land tax exemption if they rented their homes to key workers for at least two years.

The shire estimates the pilot would cost about $74,000 a year, arguing this is a far cheaper option than building 10 modular homes, estimated to cost about $2 million plus land.

About $370 million in new housing is being built across Victoria through the Regional Worker Accommodation Fund.

This includes the construction of a shared facility in St Leonards housing up to 10 workers from Sea Bounty Mussels.