News relating to Canberra.

ACT Government commits to community housing sector growth: An analysis of the ACT budget

The FY20 ACT Government budget makes further commitments to the community housing sector, responding in part to the priority areas put forward by the CHIA ACT Region Committee last October, but the sector continues to wait for past commitments to be implemented.

Identified priority areas that the budget addresses, in part, include:

Large growth in ACT Government’s annual “community housing” targets (minimum of 100), with access to community housing sites by CHPs at a price that enables CHPs to be financially sustainable.

The budget sets a target to release new sites in FY20 to enable CHPs to develop 60 new community housing dwellings. This is an increase on current year commitments to release new sites to enable development of 34 community housing dwellings in FY18 and 20 community housing dwellings in FY19. None of these sites have been made available for CHPs to bid for as yet, and thus the extent of price discounting or other subsidy intended to be provided by the ACT Government is uncertain. CHPs cannot develop and retain community housing dwellings for affordable rent absent a government subsidy.

Inclusionary zoning and other planning incentives for CHPs, or developers in partnership with CHPs e.g. height limits, plot ratio, streamlined approvals, parking

The budget includes a 25% Lease Variation Charge (LVC) remission measure for CHPs to encourage additional affordable rental and purchase opportunities on privately owned land, which has been budgeted to result in a $200,000 annual revenue hit to the ACT Government.

Land tax exemptions for private landlords as well as potential rates concessions conditional upon the management of the properties being outsourced to CHPs for social or affordable rental provision

The budget includes a two year pilot scheme capped at 100 properties to be exempt from land tax, conditional upon the properties being managed by a registered CHP and rented at <75% of market rent to eligible lower income Canberrans. This pilot commenced 1 April 2019 and has been budgeted to result in a $350,000 annual revenue hit to the ACT Government. No rates concessions are provided.

The budget fails to address the other priority area of provision of a rates exemption for CHP-owned social and affordable rental properties, to position CHPs on par with other not-for-profit organisations that provide charitable services other than provision of community housing. Such a measure, if supported by the ACT Government, would save CHPs collectively approximately $1m annually, enabling each to deliver further impact and thus take pressure off ACT Government provided housing and related community services.

In terms of delivering on measures highlighted in the ACT Housing Strategy, the budget does commit to the target of ensuring 15% of all future government land releases are for either public housing, affordable rental housing or affordable purchase opportunities. Disappointingly, the overwhelming weight of properties within the 15% remain on providing affordable purchase opportunities, with less than 10% (less than 1.5% of the total) for affordable rental housing provided by CHPs.

Separate to the above, there are positive measures introduced at the more acute end of the housing spectrum in terms of accommodation and services for the homeless, as well as continued growth of public housing. At the other end of the housing spectrum there are also positive measures in terms of facilitating home ownership for first home buyers.

Community Housing Industry Association (CHIA) ACT Region Chair Andrew Hannan says the community housing sector is keen to further engage government as it seeks to implement the measures outlined in the budget and the ACT Housing Strategy, and that the sector would welcome the opportunity to discuss other complementary reforms that may further help lift the supply of affordable housing in a financially sustainable manner. Such measures would enable the government to access the benefits that would flow from leveraging the community housing sector.

‘Canberra is in the midst of a rental affordability crisis, and boasts the highest median rent in the country…with the right ACT Government support the community housing sector has the capacity to more than double its impact over the next 10 years, and through doing so ease the current crisis in which far too many Canberran households are struggling to make ends meet in an overheated private rental market.’

‘Community housing is a proven cost-effective way for State and Territory Governments to deliver affordable housing, but requires an upfront and/or ongoing subsidy to bridge the gap between revenue from the low rent able to be charged to our low-income tenants and the costs of CHPs supplying accommodation,’ Mr Hannan says.

CHIA’s ACT Region Committee member organisations include Argyle, CHC, Catholic Care, Focus ACT, Havelock Housing and Northside Community Services.

 

CHIA ACT Region Chair Andrew Hannan is available for comment on 0404 861 896.­

Community housing welcomes new ACT Housing Strategy

Community housing organisations have welcomed this week’s launch of the ACT Government’s new Housing Strategy, which included a substantial $100m investment in public housing renewal and growth, and a commitment to the growth of the community housing sector.

Whilst detail on the specific support to the community housing sector was limited, the strategy has set a target of ensuring 15 per cent of all future government land releases are for either public housing, affordable rental housing or affordable purchase opportunities.

The government has also committed to reducing the cost of land made available to the sector and to investigating planning controls or lease variation charge remissions to encourage additional affordable rental and purchase opportunities on privately owned land.

Other key measures include the provision of head lease opportunities to the sector for 151 (just over 1 per cent of the total) public housing properties over the next five years; a commitment to explore extending land rent scheme eligibility to the sector; and, measures to grow the supply of affordable rental properties from private owners to be managed by the sector.

Community Housing Industry Association (CHIA) ACT Region Chair Andrew Hannan says the community housing sector is keen to further engage government as it undertakes investigation on potential measures outlined in the strategy, as well as some other complementary reforms, to lift the supply of affordable housing in a way that would enable the government to access the benefits that would flow from leveraging the community housing sector.

‘The community housing sector has the capacity to more than double its current property portfolio of 1,000 properties over the next 10 years with government support,’ Mr Hannan says.

‘Having our sector develop and manage properties reduces the capital burden on the government and reliance on its services. It also attracts more Commonwealth money into the ACT as community housing tenants are eligible for Commonwealth Rental Assistance.’

‘Community housing is a proven cost-effective way for the government to deliver affordable housing, but we do need help to bridge the gap between revenue from the low rent able to be charged to our low-income tenants and the costs of supplying accommodation,’ Mr Hannan says.

‘Only by bridging that yield gap can we close the gap between the high levels of demand and the low level of supply of affordable rental homes for people in the ACT.’

CHIA’s ACT Region Committee member organisations include Argyle, CHC, Catholic Care, Focus ACT, Havelock Housing and Northside Community Services.

 

ACT Government supports discounted rental program

The ACT Government has awarded Community Housing Canberra (CHC) $230,000 to establish a scheme aimed at tackling the territory’s rental housing affordability crisis.

CHC plans to develop a program, modelled on the one used by HomeGround Real Estate, that encourages landlords to rent their properties to low-income households at sub market rent.

CHC chief executive Andrew Hannan says the program will start early next year, and he urged the ACT Government to assist further by adopting a proposal by the ACT Greens that would provide landlords with incentives to participate.

The incentive would provide a land tax exemption to landlords who rented their properties via a registered community housing provider at a rent discounted by up to 25 per cent of market value.

The ACT Government is expected to release its affordable housing strategy before the end of the year.

Click here to read more.

 

Happy new NHHA?

Four jurisdictions have now signed up to the new National Housing and Homelessness Agreement (NHHA) but, despite its early promise, there’s barely a mention of community housing in the four bilaterals so far finalised.

The six national housing priorities of the NHHA are social housing, community housing, affordable housing, tenancy reform, supporting home ownership and reform of the planning system.

Specific mention is made in the priorities of community housing strategies that improve the viability and encourage growth of the sector (may include redevelopment and stock transfers). However, there it stops; the four bilateral agreements released to date contain little to support the viability or growth of community housing.

Jurisdictions must produce a housing strategy that indicates the level of housing supply needed to respond to projected demand, outlines the reforms and initiatives that will contribute to meeting this need, includes planned or expected levels of social housing, and set out how the State will contribute to the housing priority policy areas. (Clause 17(a) of the NHHA). Most states and territories are reported to be working on new strategies, with varying levels of consultation.

Jurisdictions will report annually, with public reporting by 31 October of the following year.

While we encourage you to read the agreement in full, here’s what caught our eye:

South Australia
South Australia promises to have a new housing strategy and a new homelessness strategy in place and publicly available by July 1, 2019.
It aims for an adequate supply of land to meet long-term demand and a 30-year plan for Greater Adelaide to deliver a compact urban reform.

Improving the liveability of social housing stock is included, but only via a commitment that 75 per cent of new stock built by the SA Housing Trust will meet Universal Design criteria.

The development and efficiency of CHPs will be supported through finalising the transfer of 5,000 properties, with contractual requirements ‘that support the upgrade and renewal of CHP managed houses’.

Three reviews of current housing pathways/programs are mentioned, including:
• develop contemporary service responses for young people leaving care, with a new protocol between the Department for Child Protection and Housing SA to support young people into independent housing, in 2018.
• new supportive housing for people who have experienced chronic homelessness will be implemented by 2020
• the existing aged housing program (no timeframe).

Tasmania
The bilateral acknowledges the importance of community housing – over 40 per cent of social housing is managed by community housing providers in Tasmania. However, there are no measures in the bilateral targeted at community housing and only two measures specifically for social housing – a commitment to 15 new (hopefully extra) social housing dwellings a year, and $13.6m to upgrade 1,050 public housing dwellings.

The bilateral does provide for 10 rapid rehousing homes a year for people exiting institutions (from 30 June 2019), to avoid exits into homelessness.

The Tassie Government has an aim to keep home ownership at least 5 per cent above the national average, and will maintain its First Home owner grant program and review what government land could be re-purposed to housing.

The Tasmanian Government will continue to produce quarterly reports on progress against the state’s affordable housing action plan.

ACT
According to the bilateral agreement, the ACT has the most targeted public housing portfolio in Australia with housing allocated to those in greatest need. There are 22,000 people in public housing (it omits to mention the further 1,500 in community housing).

The bilateral promises a new ACT Housing Strategy in 2018. It will address legislative requirements and the requirements of clause 17 (a) of the primary housing
Agreement, covering ‘the full housing spectrum, from homelessness, through public
housing and affordable rental and home purchase opportunities’. Sadly, however, no mention of community housing.

The agreement does promise that the ACT will set and publish annual targets for public, community and affordable housing as part of the Indicative Land Release Program.

The existing ACT social housing model will be reviewed ‘to improve viability, identify and develop initiatives to achieve efficiencies and improve stock utilisation’. This is the closest the bilateral agreement comes to addressing community housing.

Like SA, the ACT undertakes to construct public housing dwellings that are built to national liveable design standards, but is silent about any retrofitting of existing social housing stock to meet the standards.

Northern Territory
The Northern Territory bilateral describes its ‘public housing portfolio’ as including community housing.

However the NT is to be congratulated for specifically including measures to develop and implement an urban Community Housing Strategy that identifies ways to support the growth of the NT CHP sector and inform the transfer of 750 urban public dwellings to the sector, as well as construct community housing dwellings in urban centres (by 2023).

The NT will have a new housing strategy in place and publicly available by September 30, 2019.

A review of rent setting models in urban and remote areas will be undertaken by December 2019.

The NT will also consult senior Territorians and those approaching retirement about aged care housing (to identify demand) and provide findings to the private sector to help identify potential opportunities for future private sector development of seniors-appropriate accommodation.

Planning reforms include allowing more scope for providing affordable housing products through
the incorporation of a flexible approach to zoning, including through the use of Specific Use Zones in the NT Planning Scheme, and facilitating land release in remote Aboriginal communities by extending the exemption under the Planning Act (Regulation 3A), which removes the need for subdivision approval for development associated with the $1.1 billion remote housing program.