Winchelsea Community Village is a $4 million, community-led, seniors housing project. It consists of ten, two-bedroom, townhouse-style homes for older people who have ties to Winchelsea. The project aims to address the local market’s acute shortage of this type of stock and also free up larger homes, for which there is also strong demand.
Members of the Winchelsea community established Winanglo Inc, a registered non-for-profit entity, to drive this project and ultimately pave the way for further similar developments in the wider region covering Winchelsea, Anglesea and Lorne.
The ownership model is similar to that used by retirement villages. Tenants do not purchase a unit, rather they purchase a lifetime occupancy right, subject to annual fees for servicing and maintenance fees. A retention fee is charged on the on-sale value of the home at 1 per cent per year for up to 10 years. The home does not count towards the pensioner’s asset test. Purchasers do not pay stamp duty on the purchase, nor capital gains tax on any later sale.
It is a project that showcases how local communities have a deep understanding of their own local housing demand pressures and the local supply-side opportunities. critically, it highlights that with the right support, locals’ knowledge, experience and energy can translate into the deep benefit of keeping communities together (enabling people to stay) through local housing solutions.
Background
Key insight: Broader regions that see significant overall investment into housing can still face pockets of supply challenges. In this instance the lack of diversity in the local stock – specifically in the range of housing types at affordable price points – saw the community losing longstanding members.
Winchelsea is a town in the hinterland of Victoria’s Surf Coast local government area – a broader region renowned not only as a tourism destination, but also as an attractive sea and tree change destination. The broader Surf Coast LGA includes some of regional Victoria’s more expensive housing markets, particularly along the coast (the LGA’s median house price is $1.2 million; the median unit price, $872,500) that attract a significant amount of overall housing investment.
While Winchelsea is a more affordable town within the broader LGA, the project proponents identified a lack of appropriate affordable housing for lower income earners, including retirees, as a major local challenge.
The RAI-CBA Regional Movers Index publications over recent years shows a particular population phenomenon for the Surf Coast – that it tends to gain population from the capitals but loses people to other regions (2022-2024). The project proponents observed this phenomenon was especially relevant for older members of the Winchelsea community – many move to larger regional centres and cities due to a lack of suitable housing available locally.
Project development and capital contributions
Key insight: Communities with local expertise, knowledge, energy and mobilisation (including support from the local Council) were defining factors in the project’s success.
Underscoring the project’s success is its local proponents. They represented a high-value, low-cost management workforce with relevant skills and experience. They also had clear insights on the local need. Critically, their vision was supported by significant local capital contributions.
Specifically, they are semi-retirees of the local area - including a real estate agent, an architect, an engineer, and an accountant. Their combined skillsets were high-value inputs to the project but were provided at little expense, underscoring major administrative and staffing savings.
The project proponents had recognised the opportunity to realise the potential of the site to meet the specific unmet demand among local retirees.
The project proponents engaged and mobilised significant local capital to fund the project. The Surf Coast Shire Council provided the site – unused shire land originally donated by the Anglican Church in 1977 for the benefit of the community. The Council also provided support with planning processes. The Community Bank Winchelsea and District provided a $1.5 million grant.
Project financing challenges
Key insight: A pioneering project that takes place in a local housing market that has high-value homes and receives significant investment into the local stock can still be subjected to significant financial hurdles.
At the financing stage, the project received a low valuation which underscored significant challenges in funding the full construction costs. The project proponents had to contribute significant equity. The lenders considered the project as quite risky – despite proponents taking significant mitigating measures – and this added to the cost of the loan financing.
Supporting small local initiatives
Key insight: Local initiatives with strong foundations and resources will still benefit from state assistance – akin to property development consultancy services – to navigate the complexities of the housing supply system and best utilise the raft of programs offered by state and federal governments.
This project had a strong foundation and ultimately achieved success.
It started with significant local resources, a well-located site gifted to the project, a $1.5 million grant from the Community Bank and relevant skills and experience among the project proponents.
The project proponents were nevertheless still found wanting of additional resourcing – akin to property development consultancy services – to assist them navigate the complexities of housing development and financing. The project received no meaningful state or federal assistance despite the raft of policies and programs intended to achieve the very outcomes seen in this project.
At a federal level, Housing Australia offers a capacity building program to assist registered community housing providers in this way. The uptake is unclear and the scope is limited to community housing providers. As a registered not-for-profit entity providing retiree housing, Winanglo Inc is not eligible for this service. It is also unclear whether this capacity building program would assist with the specifics of the policies and programs in Victoria that would apply to this project.
Find out more in the full “Answering the Call for Regional Housing” Report.
Acknowledgment of Funding
The research presented in this report was funded by the RAI’s Intergovernmental Shared Inquiry Program. The program delivers an annual public interest research agenda focusing on topics of strategic importance to regional Australia through a partnership with federal, state and territory governments.
The RAI acknowledges our funding partners: Australian Government Department of Infrastructure, Transport, Regional Development, Communications, Sports and the Arts; New South Wales Government Department of Primary Industries and Regional Development; Queensland Government Department of Natural Resources, Mines, Manufacturing, Regional and Rural Development; South Australian Government Department of Primary Industries and Regions; Victorian Government Department of Jobs, Skills, Industries and Regions; and Western Australian Government Department of Primary Industries and Regional Development.
The views expressed in this report are those of the Regional Australia Institute and are not necessarily those of the Australian Government or the Department.