Affordable Housing

One Million Social and Affordable Homes Needed to Combat Rental Stress

Australia needs to build more than a million social and affordable houses over the next 20 years to keep pace with the growing number of people struggling to pay their rent, new analysis shows.

UNSW City Futures Research Centre’s latest report said the number of Australians in rental stress – paying more than a third of their income on rent – meant there was a need for an extra 728,600 social housing properties and 295,000 affordable rental homes by 2036.

The research showed it would cost governments $8.6 billion a year to deliver these properties working with the not-for-profit sector, which is $3 billion a year less than current negative gearing and capital gains tax subsidies.

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Lead researcher Laurence Troy said to cover the backlog of unmet need and future need over the next 20 years, two in 10 new homes would need to be social housing while a further one in 10 would need to be affordable rental homes.

“Our analysis shows that the sheer number of households in rental stress across the country means that if we’re going to meet the need, at least 12 per cent of all our housing by 2036 will need to be social and affordable housing… a very reasonable ambition in global terms,” Troy said.

One third of these homes – 316,766 – are needed in New South Wales, but regional Tasmania and South Australia need to see the highest growth rate in social housing.

Troy said based on their modelling, the best and cheapest way for governments to deliver on unmet housing needs was to fund it through a combination of upfront grants and low interest government supported financing.

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“Delivering below market rental housing through the not-for-profit sector, as opposed to the private equity model, will save $3 billion a year by removing developer mark-ups and shareholder returns,” he said.

This costing analysis was commissioned by the community housing sector.

Community Housing Industry Association NSW chair John McKenna said the data would help the sector and governments plan housing where it was most needed.

He said the number of homes needed was clearly enormous but could be delivered if all levels of government worked together and recognised that subsidised housing was not possible without some form of government support.

“State and local governments need to step up to provide the housing their communities need – either through capital grants in cash or government land, and planning mechanism that recognise housing as critical local infrastructure,” McKenna said.

The report comes as more than 2,400 community leaders and members from almost 200 organisations prepared to fill Sydney Town Hall on Thursday night to fight for concrete political commitments on housing affordability ahead of the NSW and federal elections.

Everybody’s Home campaign spokesperson Kate Colvin said these new figures highlighted that Australia’s housing crisis was a major concern for everyday people.

“It shows the housing system is far more broken that we first thought – but it also shows that delivering the scale of new homes for people who need them is entirely doable with political will and commitment,” Colvin said.

The Everybody’s Home campaign has called for governments to develop a national strategy to provide 500,000 social and affordable rental homes, increase rent assistance to reflect increased housing costs, and create a plan to end homelessness in Australia by 2030.

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“The massive turn out for the Sydney Town Hall Assembly tonight shows that housing and cost of living is a key issue that’s biting deeply in the electorate, particularly for millions of Australians locked out of the housing market [or] struggling to pay the rent,” Colvin said.

“We need to rebalance the budget and really redirect the funding for housing to where it’s needed most so that everybody in Australia has a home.”

Source: Probono

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