More than 200 Geelong houses face the wrecking ball despite national supply targets

Demolition of more than 200 homes has been approved in Geelong so far this financial year, new ABS data shows.

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More than 200 homes have been cleared to be demolished in Geelong this year, as new data reveals where most residential properties are being flattened.

The latest figures from Australian Bureau of Statistics show Geelong councils have cleared 227 homes to be razed so far this financial year, meaning that for nearly every 12 new homes given the nod for construction, one has been tagged for destruction.

Housing approvals data over the same period shows 2556 new homes set for construction.

The top spot for demolitions was Portarlington, with 26 permits issued.

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Across the peninsula in Ocean Grove, 21 homes face the wrecking ball, with 120 homes approved for construction.

Neville Richards Portarlington agent Luke Campbell said rundown beach houses are being knocked over for significant residences, and sometimes dual occupancy projects.

“It’s becoming more permanent – I think people are coming down here. Look at the Portarlington beachfront, there’s probably five knockdown-rebuilds underway,” Mr Campbell said.

“They are all little 1960s rundown beach shacks that probably have been demolished, and now people are building their new double storey modern home they’re going to live in.

“People are relocating down this way because they want to get out of Melbourne or coming across the peninsula from Ocean Grove because they’re finding that too busy,” he added.

The remains of a demolished house in Wilsons Rd, Newcomb, which is set to be replaced with a rooming house.

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Fletchers Ocean Grove agent Ben Roberts said there was a resurgence in interest in properties where plans and permits are in place for development as people warm to the negative gearing and capital gains tax benefits retained for new homes.

“The reality is some of those houses that have been demolished are 80 years old and just aren’t fit for habitat in this day and age,” Mr Roberts said.

“There’s a lot of people around that want to upgrade where they want to live.”

McGrath Geelong agent David Cortous said there weren’t many townhouse developers active in blue-chip suburbs, such as Newtown where 13 houses were cleared to be demolished, and 14 approved for construction.

“With the price of land in Newtown it’s pretty simple – the building costs doesn’t stack up.

“I’d say probably 90 per cent of them would have been for families.

“It’s astronomical to build a custom home, so you’re going to see a lot more volume builders in these blue chip areas as well.”

Where the most homes face demolition

Source: Australian Bureau of Statistics. Data for SA2 statistical divisions.

Established suburbs where demolitions are leading to a net increase in new homes include Norlane, Belmont, Hamlyn Heights and Newcomb.

Harcourts, North Geelong agent Joe Grgic said with the high cost of construction, many developers prefer to renovate an existing house and build a second and potentially third dwelling on a subdivided block.

“There’s an expectation that a block of 600sq m or larger is appropriate for two dwellings, but a lot of people don’t understand that it can also be the zoning that says how many dwellings you can have,” Mr Grgic said.

“The cost of construction has just jumped so dramatically, and then the cost of subdivision with development, so council is charging more than ever, Barwon Water will charge you more than ever,” he added.

This new duplex in Whittington is close to completion after the existing house was demolished.

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“On some occasions, people have pushed forward with demolition and whether the house is so far gone, (or are) forced into it because of the regulations with rentals and minimum standards.”

Approvals for demolitions since the National Housing Accord began in July, 2024, have topped 34,000 about Australia.

Approvals for construction in the same timeline are about 271,000.

The National Housing Accord’s 1.2 million homes target was intended to deliver housing supply that would slow the rate of home price growth by accommodating rising population and demand for homes.

Housing Industry Association economist Maurice Tapang said with housing approvals already struggling to match government expectations they were expecting barely a million homes to be built in the Accord’s timeline, and hundreds of thousands to be lost to demolitions.

“In net terms, we think it will be closer to 800,000,” Mr Tapang said.

“And that definitely isn’t enough to meet growing demand,” he added.