Affordable Housing

National Housing Finance and Investment Corporation (NHFIC) Consultation Paper
Grattan Institute
October 2017

Rapidly rising house costs have triggered renewed community concerns about housing affordability, especially for low-income earners. This submission summarises recent work by Grattan Institute that is relevant to the objectives of the NHFIC, and the provision of affordable housing more broadly.

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Establishment of An Australian Affordable Housing Bond Aggregator
EY
September 2017

EY were commissioned by the Australian Government to look at the viability and provide an implementation plan for the establishment of an affordable housing bond aggregator.

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National Housing Finance and Investment Corporation Consultation Paper
Australian Government
September 2017

In the 2017-18 Budget, the Government announced a comprehensive housing affordability plan to improve outcomes across the housing continuum. The Government’s plan includes establishing:

  • The National Housing Finance and Investment Corporation (NHFIC) – a new corporate Commonwealth entity dedicated to improving housing affordability;
  • A $1 billion National Housing Infrastructure Facility (NHIF) which will use tailored financing to partner with local governments in funding infrastructure to unlock new housing supply; and
  • An affordable housing bond aggregator to drive efficiencies and cost savings in the provision of affordable housing by community housing providers.

The purpose of this Consultation Paper is to seek feedback on the potential structure and governance of the NHFIC, and the operation of the NHIF and affordable housing bond aggregator.

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Assisting Housing Affordability
Industry Super Australia
November 2017

This discussion paper endeavors to identify the underlying causes of affordability issues, and to consider some useful policy responses in the current and historical context.

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Government led innovations in affordable housing delivery
AHURI
October 2017

This project examined state government-led innovations in affordable housing through analysis of two state-level strategies and two state-level programs. The research shows effective strategies and programs rely on strong political leadership; adopt a whole-of-housing industry approach to consultation and implementation; communicate objectives effectively to all stakeholders; are resilient to changes of government; and are best run from a central agency with a flexible organisational structure that can respond quickly to opportunities.

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The Property Ladder after the Financial Crisis: The First Step Is a Stretch but Those Who Make It Are Doing OK Abstract
RBA
September 2017

The global financial crisis (GFC) focused attention on household debt in dramatic fashion. While Australia escaped much of the immediate fallout, concerns over the level of household debt have become more entwined in policy deliberations in recent years. Parallel concerns, flowing from the rapid growth in housing prices in Australia and focusing on first home buyers, have also emerged. Some are concerned that this rapid growth is shutting a generation out of the home ownership market. Others are worried that those who do manage to buy a first home are taking on inadvisable levels of debt to do so.

This paper investigates how things have changed since the GFC for those stepping onto the property ladder. Is ‘generation rent’ an important trend? Are people buying first homes taking on ‘too much’ debt? And what implications does this have for our understanding of the growing level of aggregate household debt?

The RBA finds that fewer people are making the transition from renters to owners than prior to the crisis. Those that do, however, are more financially stable than earlier cohorts. Thus, ‘generation rent’ is an important trend but a consequence is that those who do step onto the property ladder are, on average, better placed to pay off their loans. We attribute much of this change to the increase in housing prices and the associated hurdle that deposit requirements represent. While saving a deposit is a stretch, it is also a sign of financial discipline that is associated with fewer subsequent difficulties.

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Housing Australia
CEDA
August 2017

The great Australian dream of owning your own home has prevailed for more than half a century but with surging house prices in some parts of Australia, there has been much debate about whether it will continue. Historically low interest rates, an unprecedented period of continuous economic growth and strong levels of migration have contributed to increasing demand and escalating housing prices in Australia’s capital cities.

This policy perspective examines:

  • Housing trends in Australia;
  • The experience of Australia’s housing sector compared with other countries in the OECD;
  • Supply of housing: from land availability to changes in the composition of housing stock;
  • Drivers of demand and possible policy levers; and
  • The intergenerational consequences of high housing costs and falling home ownership.

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Modelling housing need in Australia to 2025 AHURI August 2017

This research developed a housing need simulation to quantify the need for affordable housing and identify the supply required to meet the demand for housing. This information is important for resource allocation, market monitoring, setting affordable housing targets, housing assistance budgeting and evidence for affordable housing contributions via planning policy.

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The Opportunities, Risks and Possibilities of Social Impact Investment for Housing and Homelessness
AHURI
August 2017

This study investigated the opportunities and risks for social impact investments (SII) to improve housing and homelessness outcomes in Australia. It described what social impact investing is and its application to housing and homelessness policy in Australia, as well as examined different finance models and structures, SII markets and case studies.

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Multi-Family as an Asset Class in Australia: Are We There Yet?
EY Real Estate Advisory Services
June 2017

To date, there have been sound reasons why the multifamily real estate model has failed to gain traction amongst institutional developers and investors in Australia. These include commensurately higher returns historically being available on other property types (e.g. office), an established institutional market mentality (across developers and financiers) of realising capital growth up-front through sell-down of residential properties, and limited experience in the operation and management of large-scale residential portfolios under lease, particularly in ‘vertical’, apartment-style properties.

However, as we discuss in this piece, the hatching of innovative lease frameworks and delivery models is paving the way for multi-family real estate development that is economically viable, and with this, new avenues are also emerging for enhancing housing affordability.

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Stakeholder Perspectives on Australia’s Affordable Housing System Australian Futures Project July 2017

This report provides insight into how different stakeholders see the affordable housing system in Australia. The research was undertaken by the Australian Futures Project and was commissioned by the National Australia Bank as part of their commitment to working with stakeholders to explore solutions to improve affordable housing (broadly defined).

The findings are based upon 17 in-depth interviews with leaders from across different components of affordable housing system including government, non-government, the private sector, and academia. A wide range of literature was also reviewed and evidence from this literature is included to provide context to interviewee perspectives.

In discussing affordable housing, interviewees focused on both the challenges facing the affordable housing system today, as well as ideas for a better future.

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Getting the best from the private rental sector for lower income households
AHURI
July 2017

The latest census reveals that the proportion of renters in Australia has risen, with 30.9 per cent of Australians renting their home in 2016. The Australian Government spends billions of dollars each year on the private rental market—in the form of Commonwealth Rent Assistance direct payments and indirect tax concessions like negative gearing and capital gains tax discounts. Can government secure greater levels of public benefit from its expenditure in the private rental market to help lower income households while also reducing the demands on the social housing system? This Policy Issue Analysis examines a number of innovative alternatives and strategies that governments can consider to make the private rental market more affordable and stable for tenants.
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Inquiry into Housing Policies, Labour Force Participation and Economic Growth
AHURI
June 2017

The AHURI Inquiry into housing policies, labour force participation and economic growth, undertaken by researchers from Curtin University, the University of Sydney, and RMIT University, gathered evidence on how housing policies might promote labour force participation and economic growth through four channels—housing supply responsiveness, labour mobility, employment decisions and consumption. The report repositions housing to a more central place within economic policy debates, and suggests a coordinated policy treatment of housing as an economic asset has implications for nation-wide economic growth.

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Australian Affordable Housing Environmental Scan 2017-18
PowerHousing Australia Corelogic
June 2017

The gap between average incomes and average home prices in Australia continues to widen, according to a new report by PowerHousing Australia and CoreLogic released today.

The Australian Affordable Housing Environmental Scan 2017-18 examines the key metrics for housing affordability across the country. It highlights the urgent need to implement new measures, such as those announced in the recent Federal and NSW state budgets, to improve access to the housing market, especially for those on lower incomes such as first home buyers, key workers, seniors and social housing tenants.

The report shines a light on just how acute the housing market participation challenge is for low-income earners, for both renters and those looking to become homeowners. The situation for first home buyers is particularly dire today.

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Developing the scale and capacity of Australia’s affordable housing industry
AHURI
April 2017

This study investigated the capacity constraints affecting Australia’s affordable housing industry, which is critical to addressing the housing needs of low-income Australians. Industry stability and growth relies on government policy continuity and directional clarity; subsidies being adequate, appropriate and assured; and the potential contribution of specialist institutions such as a financial intermediary to access to low-cost funds to support key industry requirements.

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Transformative Transfers: Growing Capacities in UK Social Housing
AHURI
March 2017

This study investigated what was required to create successful non-profit housing providers through public housing transfers in the UK and the roles that policies played in the process. The review informs current Australian moves towards the transfer of public housing to non-profit providers.

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Report on Government Services 2017 – Housing
Productivity Commission
February 2017

This chapter presents data on the performance of governments in providing social housing, including public housing, State owned and managed Indigenous housing (SOMIH), community housing and Indigenous community housing. The National Affordable Housing Agreement (NAHA) is the overarching agreement between Australian, State and Territory governments for providing assistance to improve housing outcomes for Australians.

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Recent housing transfer experience in Australia: implications for affordable housing industry development
Hal Pawson; Chris Martin; Kathleen Flanagan; Rhonda Phillips – AHURI Working Paper 273
December 2016

Focusing primarily on public housing transfers in Queensland, South Australia and Tasmania, this Inquiry analysed the associated processes and frameworks to reveal the lessons learned. The case studies reveal aspects of transfer practices such as capturing Rent Assistance-enhanced revenues; the transfer of ‘management’ rather than freehold title; and the absence of a role for tenants. Financial modelling indicated that management transfers, where community housing providers are assured of cash flow from rents, may be a viable means for addressing moderate maintenance backlogs, enhancing community development and modestly expanding affordable housing portfolios.

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Innovative Financing Models to Improve the Supply of Affordable Housing
Council on Federal Financial Relations Affordable Housing Working Group
October 2016

On 7 January 2016, the Australian Government announced the establishment of an Affordable Housing Working Group (the ‘Working Group’) following a request from Treasurers at the Council on Federal Financial Relations (CFFR) meeting in October 2015 for further work on housing affordability.  The Working Group focused primarily on investigating ways to boost the supply of affordable rental housing through innovative financing models. These models are aimed at the social housing sector and the private rental market for low-income and disadvantaged households.

The Working Group undertook a public consultation process (2 February 2016 – 11 March 2016), which included a call for submissions from interested parties on innovative ways to improve the availability of affordable housing as highlighted by the attached Issues Paper.

The Working Group delivered its report to Heads of Treasuries on 3 November 2016. At the CFFR meeting on 2 December 2016, Treasurers considered the Working Group’s report. Treasurers agreed to the recommendations of the report, in particular the establishment of a bond aggregator taskforce, and agreed to make the report publically available. The taskforce will design a bond aggregator model and report back to Heads of Treasuries by mid-2017.

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The Use Of Guarantees In Affordable Housing Investment—A Selective International Review
Julie Lawson (AHURI)
October 2013

This report aims to build critical capacity amongst public policy-makers, towards the development of an appropriate bond instrument, intermediary and guarantee structure for the provision of affordable housing investment.

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The Use Of Guarantees In Affordable Housing Investment—A Selective International Review
Julie Lawson (AHURI)
October 2013

This report aims to build critical capacity amongst public policy-makers, towards the development of an appropriate bond instrument, intermediary and guarantee structure for the provision of affordable housing investment.

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Subsidised Affordable Rental Housing: Lessons From Australia And Overseas
Steven Rowley; Amity James; Catherine Gilbert; Nicole Gurran; Rachel Ong; Peter Phibbs; David Rosen; Christine Whitehead
August 2016

The supply of affordable rental housing is essential to allow households to transition out of scarce public and social housing and into the private rental sector. Affordable rental options are essential for those households already in the private rental sector who are struggling to pay market rents. This report explores the lessons that can be learnt from the National Rental Affordability Scheme (NRAS) (discontinued in 2014), which sought to stimulate the supply of affordable rental housing for low- and moderate-income earners. Drawing on evidence from comparable international programs for subsidising rental housing supply, the report makes recommendations on how to design and fund a new scheme to deliver the supply of affordable rental housing required in Australia.

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Housing Affordability – The Australian Dream: What Can Be Done?
KPMG
28 October 2016

In this short paper, KPMG’s Chief Economist Brendan Rynne discusses the factors contributing to demand and supply, median house prices, demographic influences, intergenerational equity and interventions and reforms both systematic and targeted to alleviate housing affordability.

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From Housing Assets To Housing People

Infrastructure Partnerships Australia And KPMG
October 2016

A major new report by Infrastructure Partnerships Australia, with financial modelling by KPMG outlines a plan to fix Australia’s struggling public housing system by providing more money and more places for vulnerable households.
The new model, developed by IPA and KPMG in consultation with the NSW Government and industry stakeholders, shows that existing social housing stock delivers state governments poor financial returns, is becoming more costly to maintain and no longer meets the needs of tenants.

Under the IPA model, jurisdictions around Australia would establish a Social Housing Future Fund (SHFF) – similar to the Federal Government’s Future Fund – to deliver returns assumed in the modelling to be CPI plus 4.5 per cent each year; reversing the status quo where public housing drains the budget.

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Towards A National Housing Strategy
2016
Compass Housing Services

A number of housing and community organisations, other agencies and academics have come together to create Towards a National Housing Strategy. The Strategy identifies a central role for the Commonwealth Government in shaping the economic, political and cultural environment in which housing is provided. A National Housing Strategy, developed and led by a Housing Minister, is an essential ingredient of ensuring that every member in Australian society has access to adequate housing. Providing adequate housing is an investment in future generations. It will benefit the health and wellbeing of all residents of Australia. It will be an economic stimulus as it was in 1945 and 2008, and contribute generally to the efficient functioning of our regions, cities, towns and communities.

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A Federal Incentives Model For Housing Supply
Deloitte Access Economics / PCA
April 2016

The Property Council of Australia commissioned Deloitte Access Economics to investigate whether an National Competition Policy style federal incentives model could be applied to stimulate improved housing outcomes, and what the benefits from an effective model could be.

The Deloitte Access Economics Paper details how Federal incentives could drive planning reform:

  • Set targets – States and the Commonwealth agree on metrics and outcome, with flexibility in the arrangements to accommodate jurisdictional differences.
  • Make someone responsible – there needs to be an entity that collects data and measures performance against targets and outcomes.
  • Model the benefits – modelling needs to be thorough to better understand the size of the revenue or economic gains.
  • Link Payments to Action– both for up-front reforms, and on an ongoing basis.
  • States to lead but involve local government– States have a responsibility to set direction, but local government should be rewarded for delivering at the granular level.

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Property Council Submission – Affordable Housing Working Group: Issues Paper – Innovative Financing Models
Property Council Of Australia
March 2016

The Property Council of Australia is pleased to provide a submission to the Working Group on its issues paper and innovative financing models for affordable housing delivery. The submission points to possible solutions such as enabling and facilitating institutional investment and the United States’ Low Income Housing Tax Credit model. Both would enable the private sector to deliver more affordable housing without compromising affordability for the whole market; however both require concerted action from all levels of government.

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Affordable Housing Working Group: Issues Paper
Australian Government
January 2016

The Affordable Housing Working Group (‘the Working Group’) has been established by the Australian Government under the Council on Federal Financial Relations (CFFR). Its objectives are to:

  • identify potential financing and structural reform models that increase the provision of affordable housing (social housing and housing in the private rental market) for those on low incomes;
  • provide assessments of potentially viable proposals put forward by stakeholders; and
  • outline the best method to progress further any models that are identified as potentially viable.

This Issues Paper seeks to provide the necessary background to allow interested parties to focus their submissions on the Working Group’s key areas of interest.

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Innovative Financing Efforts Aimed At Preserving Workforce And Affordable Housing

ULI Terwilliger Center for Housing
December 2015

The shrinking supply of workforce and affordable rental housing in cities across the U.S. has sparked innovative financing vehicles from an array of real estate firms to preserve the units, helping to stem the loss of an urgently needed product. Preserving Multifamily Workforce and Affordable Housing, published by the ULI Terwilliger Center for Housing, profiles 16 leading efforts to retain the affordability of rental units that have either lost or are at risk of losing government subsidies, as well as “naturally occurring” affordable units that are likely to be repositioned to serve higher-income households.

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National Housing Conference 2015
Wed 28–Fri 30 Oct 2015

Speaker presentations from NHC 2015 are now available via the NHC website. There are two convenient ways to access the presentations:


Housing Affordability In A Rapidly Growing Metropolis: Melbourne
Steve Dunn, Director Structure Planning –
MPA
October 2015

Mr Dunn presented at the National Housing Conference 2015. His presentation looked at how Melbourne is growing and how it can increase the supply of affordable housing.

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Urban Productivity And Housing 29 October 2015
Peter Seamer Metropolitan Planning Authority
October 2015

Peter presented at the National Housing Conference on Urban Productivity and Housing with a focus on Melbourne.

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Federal States And Public Housing Transformation
Dr Julie Lawson – Affordable Housing Industry Capacity Study
October 2015

Dr Lawson presented at the National Housing Conference in Perth.

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Affordable Rental Housing: The Problem And Its Causes
Andrew Haylen – NSW State Government
October 2015

This paper outlines the extent of the undersupply of affordable housing in NSW and the market based and policy shortcomings behind this shortfall. This briefing paper seeks to expand on this discussion by outlining in detail the legislative and policy framework related to affordable housing in NSW and more broadly in Australia. This will provide the basis for the discussion to follow in the latter part of the paper regarding future policy options – with a particular focus on the supply-side planning and financing mechanisms available to government to facilitate affordable housing supply growth.

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Policy, Planning And Financing Options For Affordable Housing In Melbourne – A Background Report For Transforming Housing
Alexander Sheko – Research Associate, University Of Melbourne, Dr Andrew Martel – Early Career Researcher, University Of Melbourne And Andrew Spencer – Associate, SGS Economics And Planning
July 2015

This paper addresses the question of how to leverage greater investment in affordable housing in the context of investment returns typically too low to attract investors and limited government funding to directly bridge this gap. It contemplates various policy, planning and financing mechanisms to this end. It draws on research carried out by the Transforming Housing team at the University of Melbourne, which has also been used to inform the options paper developed to provide a basis for discussion at an affordable housing summit held at the University in April/May 2015. This paper is intended to be read together with the other background papers prepared by the Transforming Housing team (Whitzman, 2015; Newton et al., 2015).

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Affordable Housing Summit: Policy And Regulation
Professor Nicole Gurran
April 2015

Slides from presentation given on affordable housing policy and regulation at the Affordable Housing Summit (30 April – 1 May 2015).

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Next Moves? Expanding Affordable Rental Housing In Australia Through Institutional Investment
Vivienne Milligan, Hal Pawson, Peter Williams And Judith Yates
March 2015

This report presents the latest insights into new ways of financing much needed affordable rental housing in Australia, especially by attracting large scale institutional investors into the field. It builds on 2012/13 research led by the City Futures Research Centre (UNSW) into prospects for such a direction, as informed by a high level panel of industry experts and policy makers. To update that research, this report revisits the previous findings, reviews recent domestic and international housing investment developments, and summarises insights and experiences generated from a new round of contacts with local experts.

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Processes For Developing Affordable And Sustainable Medium-Density Housing Models For Greyfield Precincts
AHURI
January 2015

This project investigates a design-oriented, integrative development approach that responds to a timely opportunity in the greyfields of Australian cities: how to redevelop dispersed and ageing public housing properties in the middle suburbs. Greyfields in the Australian context have been defined as those ageing but occupied tracts of inner and middle ring suburbia that are physically, technologically and environmentally failing and which represent under-capitalised real estate assets—given that in greyfields, the built asset makes little or no contribution to the market value of the property compared to the land component (Newton 2010). The project sits at the core of questions regarding the intensification of the middle suburbs: how to find new ways to accommodate population increases; how to create affordable and diverse housing options; how to manage ageing housing stock, and how to maximise the use of existing infrastructure and amenity. Through a design lens, this research focuses on alternative development approaches that could challenge conventional methods of infill delivery.

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Eight Housing Affordability Myths
Stephen Kirchner – The Centre For Independent Studies
July 2014

Along with many other countries, Australia has experienced a significant increase in house prices in recent decades Unfortunately, many of the policies pursued by Australian governments in the name of housing affordability, such as first home buyer grants and concessions, increase demand for housing while failing to tackle regulatory and cost barriers to housing supply. Some policy proposals for improving housing affordability focus on demand suppression and diversion rather than augmenting housing supply. This reflects a failure to understand the relationship of these policies to the conceptual framework outlined above. However, it also reflects a number of highly persistent myths about the nature of housing markets, the dynamics of house prices, and the drivers of housing affordability that in turn condition public policy. This report seeks to tackle these myths in an effort to improve the quality of public debate about housing affordability.

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How Might Bond Finance Expand Affordable Housing In Australia?
AHURI
June 2014

This bulletin is based on research conducted by Dr Julie Lawson at AHURI Research Centre—RMIT University, Associate Professor Vivienne Milligan at AHURI Research Centre—the University of New South Wales and Associate Professor Judy Yates at AHURI Research Centre—the University of Sydney. The project explored using bond finance—in particular the Austrian model of Housing Construction Convertible Bonds—to expand stocks of affordable housing in Australia.

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Public Housing Transfers: Past, Present And Prospective
Hal Pawson, Vivienne Milligan, Ilan Wiesel And Kath Hulse For AHURI
October 2013

This is the final report of a study which is the first to document and analyse the largely experimental transfers of public housing to NFP community housing providers (CHPs) completed in Australia to date—their drivers, their processes, their outcomes.

Based on this review, we identify the principal policy, operational and financial barriers to larger-scale transfers and propose conceptual foundations and operating parameters for transfer programs that might be implemented in coming years.

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Towards Cost Effective Private Financing Of Affordable Rental Housing
Julie Lawson, Vivienne Milligan And Judith Yates
December 2012

A critical issue facing countries such as Great Britain, Australia and the Netherlands, is how to reinvigorate residential construction in times of fiscal constraint and credit squeeze. More than ever before there is a need for strategic public measures to channel and lower the cost of private investment in the affordable segment of the rental housing market and, in particular, to ensure that this housing can be accessed by lower income tenants. This article outlines a proposal, developed for Australian conditions, that shows how conditional public subsidies, private housing supply bonds, a special purpose intermediary and regulated not-for-profit providers could be utilized to address the growing need for affordable rental housing. It is inspired by the successful Housing Construction Convertible Bonds, which continue to channel considerable funds towards the limited profit housing sector in Austria.

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Quantifying Planning System performance and Australia’s Housing Reform Agenda
An Investigative Panel Nicole Gurran, Peter Phibbs, Glen Bramley, Catherine Gilbert And Tricia Austin For AHURI
2010

As Australia’s national urban policy framework evolves there is growing concern for the quality and performance of Australian planning systems (Local Government and Planning Ministers’ Council 2011, KPMG 2010, Productivity Commission 2011). In the context of serious housing supply and affordability problems, there is particular scrutiny of the range of housing outcomes delivered through the planning and development process (NHSC 2010a). However, the evidentiary framework for measuring planning performance across a range of objectives and goals, including those relating to housing, remains limited.

This study sought to establish an evidentiary foundation, so as to inform planning and housing reform processes, provide a basis for ongoing performance monitoring, and support further research efforts in this significant policy arena. The project aimed to establish a framework for examining how spatial policy, planning regulation, and infrastructure charging regimes influence housing market outcomes across Australian cities and regions; to inform the planning and housing reform policy; and to provide a basis for ongoing monitoring of planning system performance.

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