COVID19 SPECIAL REPORT: SOCIAL HOUSING
A HOUSING STRATEGY WITH COMMUNITY BENEFITS AS A WA HOUSING POLICY SHOWED, INVESTING IN SOCIAL HOUSING CONSTRUCTION COULD BE A KEY POST-PANDEMIC ECONOMIC STRATEGY THAT WOULD ALSO BENEFIT A GREAT NUMBER OF LOW-INCOME AUSTRALIANS INTO THE BARGAIN.
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ell before the impacts of the 2020 pandemic, large numbers of lower-income Australian households were struggling to find affordable housing and there were long wait lists for social housing. Australian Housing and Urban Research Institute (AHURI) research estimated that in 2016, there was a shortfall of around 431,000 social housing dwellings, and that this deficit would grow to 727,300 dwellings by 2036. The research concluded that 36,000 new social housing dwellings per year were required to meet this need. With high unemployment and increased incidence of homelessness a likely outcome of the economic downturn, new social housing will be essential to ensure housing outcomes do not worsen. Industry and community organisations and peak bodies are calling for a social housing building program as part of the economic stimulus response. For example, the Australian Council of Social Service in a recent report proposes building 30,000 social housing dwellings as a way to reduce homelessness and to boost employment. AHURI research modelling identifies a capital grant model as the most effec-
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tive long-term funding mechanism for affordable rental housing for low and very low-income households. This approach combines a larger upfront government grant with some borrowings from the bond market obtained through the National Housing Finance Investment Corporation, and savings to the government through not using any Commonwealth Rent Assistance payments. Of the five scenarios modelled for the costs of developing and operating required social housing dwellings across a 20-year timeframe, this was the most cost-effective in the long-term. An up-front investment provided by the Australian Government provides immediate economic stimulus to get the construction industry operating at full capacity as quickly as possible. Lack of available capital during economic downturns may leave private development projects to languish. Indeed, the construction industry associations, the union (the CFMEU) and the Master Builders Australia are predicting that investment in residential and business construction will fall by 40 to 50 percent due to the pandemic. As a consequence, the
Inner Sydney Voice • Winter 2020 • www.innersydneyvoice.org.au
