Home ownership has been a long-standing issue that Australia is in the midst of addressing.
According to an article by Domain as reported by Tawar Razaghi and Kate Burke, Labor plans to construct 250,000 affordable rental homes in what Rachel Trigg has described as a ‘once-in-a-generation, game-changing’ proposal.
Rachel spoke with Domain about the national housing matter and possible solutions, addressing Labor’s policy regarding home ownership and rental supply.
Federal election 2019: Labor’s affordable housing plan a ‘once-in-a-generation’ proposal
Article originally published in Domain. Authors: Tawar Razaghi, Kate Burke
Labor’s plan to construct 250,000 new affordable rental homes over a decade has been described as a “once-in-a-generation, game-changing” proposal by a director at property consultancy firm Urbis.
The policy will build on the National Rental Affordability Scheme, which was dismantled in 2014, and aims to deliver 20,000 homes in its first term if Labor wins Saturday’s federal election.
Urbis director Rachel Trigg said that would be the single biggest contribution to Australia’s affordable housing supply in history.
“I think it would be a once-in-a-generation, game-changing proposal, particularly if the full 10 years of supply were rolled out,” Ms Trigg said.
“I think it is the most substantial of the policies around housing that’s currently on offer at this election.”
She said new affordable housing investment was critical with much of Australia’s social housing, which was built immediately after World War II, coming up to its use-by date.
In return for investors setting rents 20 per cent below market rate for tenants on low to moderate incomes, the taxpayer-funded scheme will provide annual incentives of $8500 per year for 15 years for newly constructed properties.
The homes must be owned or managed by a registered community housing provider.
The policy is estimated to cost $102 million over the forward estimates to 2021-22 and $6.6 billion over the decade to 2028-29.
Ms Trigg said while the government’s National Housing Finance and Investment Corporation (NHFIC) had made some inroads for community housing providers’ projects, a raft of measures were needed rather than a single policy plank.
“We need more policies. It’s not a one-size-fits-all,” Ms Trigg said.
Labor’s proposal to halve the tax rate of build-to-rent housing constructions from 30 per cent to 15 per cent was another positive, she said.
“I know lots of private developers have been looking at this as a model … they’ve had a lot of interest but they have not been able to make it stack up financially,” Ms Trigg said. “I’m very hopeful that it might get it over the line. At least [initially] these projects … will be trialled and that will build confidence and comfort for investors in the model working.”
Ms Trigg said there was plenty of appetite from local investors, including superannuation funds which already have skin in the game in build-to-rent projects in the UK and the US.
“Again it wouldn’t be a policy that would fix everything by itself, but for some kinds of households it could be a really good option.”
To continue reading the full article, originally published by Domain, click here.