A Response to the Social Housing in NSW Discussion Paper
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A Response to the
Social Housing in NSW
Discussion Paper
Prepared by:
Anglicare Sydney
Churches Housing
Endorsed by:
Aged and Community Services NSW & ACT
Anglican Retirement Villages (ARV)
Anglicare North Coast
Anglicare NSW South, NSW West & ACT
BaptistCare NSW & ACT
Ecclesia Housing
NSW Ecumenical Council
1
February 2015
Contents
1. EXECUTIVE SUMMARY .................................................................................................................... 5
2. SUMMARY OF RECOMMENDATIONS.............................................................................................. 7
3. WHO WE ARE AS AGENCIES .......................................................................................................... 10
3.1 Anglicare Sydney ......................................................................................................................... 10
3.2 Churches Housing ....................................................................................................................... 10
3.3 Endorsing agencies...................................................................................................................... 11
4. SCOPE OF THE SUBMISSION ......................................................................................................... 13
4.1 Scope and definitions.................................................................................................................. 13
4.2 The need for affordable housing: underlying assumptions ........................................................ 14
5. PILLAR 1 A SOCIAL HOUSING SYSTEM THAT PROVIDES OPPORTUNITY AND PATHWAYS FOR
CLIENT INDEPENDENCE......................................................................................................................... 15
5.1 Continuity of secure, appropriate and affordable housing ........................................................ 15
5.2 Shortage of affordable dwellings ................................................................................................ 16
5.3 Unaffordability of the private market ......................................................................................... 16
5.3.1 First home purchasers.......................................................................................................... 16
5.3.2 Renters ................................................................................................................................. 17
5.3.3 Commonwealth Rent Assistance ......................................................................................... 18
5.3.4 Rental Affordability Snapshot 2014 ..................................................................................... 19
5.3.5 Household types in social housing ....................................................................................... 19
5.3.6 Insecurity of tenure.............................................................................................................. 20
5.3.7 Housing NSW products and services.................................................................................... 20
5.4 Link between housing insecurity and food insecurity – Anglicare Australia research ............... 21
5.4.1 Concepts of food insecurity ................................................................................................. 21
5.4.2 The links between food and housing insecurity .................................................................. 22
5.4.3 Low income, renting and housing insecurity ....................................................................... 22
2
5.4.4 Low income and rental stress .............................................................................................. 23
5.5 Vulnerable groups and the link between affordable housing and social disadvantage ............. 24
5.5.1 People with a disability ........................................................................................................ 24
5.5.2 Older renters ........................................................................................................................ 25
5.5.3 Young single mothers........................................................................................................... 26
5.5.4 Single older women ............................................................................................................. 27
5.5.5 Single parents on Newstart .................................................................................................. 29
5.5.6 Aboriginal and Torres Strait Islander People ....................................................................... 30
5.5.7 Homeless individuals and families ....................................................................................... 30
5.5.8 Refugees and asylum seekers .............................................................................................. 32
5.6 Summary of Recommendations.................................................................................................. 33
5.7 Increase supply and availability of affordable housing in the private market............................ 33
5.7.1 State housing portfolio ........................................................................................................ 34
5.7.2 State and local policies to increase affordable housing supply ........................................... 34
5.7.3 National Rental Affordability Scheme.................................................................................. 35
5.7.4 Review housing taxes and concessions................................................................................ 35
5.8 Improve pathways, conditions and sustainability for private rental tenants ............................. 36
5.8.1 Review residential tenancy conditions ................................................................................ 36
5.8.2 Rentstart .............................................................................................................................. 36
5.8.3 Adequate income support and Commonwealth Rent Assistance ....................................... 37
5.8.4 Greater assistance for social housing applicants and unexpressed need ........................... 38
5.9 Improve potential for opportunity and pathways for client independence............................... 38
5.9.1 Location of social housing .................................................................................................... 38
5.9.2 Supported accommodation for single young mothers ........................................................ 39
5.9.3 Integrated housing models for at-risk or homeless youth .................................................. 39
6. PILLAR 2 A SOCIAL HOUSING SYSTEM THAT IS FAIR ..................................................................... 40
6.1 Fairness across the housing market ............................................................................................ 40
3
6.2 Length of tenure and exit rates................................................................................................... 41
6.3 Allocation of social housing dwellings ........................................................................................ 41
6.4 Recommendations ...................................................................................................................... 41
7. PILLAR 3 A SOCIAL HOUSING SYSTEM THAT IS SUSTAINABLE ...................................................... 43
7.1 Essential State infrastructure ...................................................................................................... 43
7.2 Social housing stock .................................................................................................................... 44
7.3 Recommendations ...................................................................................................................... 44
7.3.1 Federal and State government investment ......................................................................... 44
7.3.2 Disposal of social housing assets ......................................................................................... 45
7.3.3 Community Housing Providers ............................................................................................ 45
7.3.4 Rebuilding of existing social housing dwellings ................................................................... 46
8. CONCLUSION ................................................................................................................................. 47
9. REFERENCES .................................................................................................................................. 48
4
1. EXECUTIVE SUMMARY
As agencies at the forefront of social and affordable housing and service provision to those at risk of
homelessness, we are of the view that sustainable and affordable housing is essential for those who
live on the margins and experience multiple forms of disadvantage and deprivation. Appropriate,
secure and affordable housing is foundational for the well-being of individuals, families and
communities.
This submission addresses the three Pillars as outlined in the Discussion Paper:
Pillar 1: A social housing system that provides opportunity and pathways for client
independence
Pillar 2: A social housing system that is fair
Pillar 3: A social housing system that is sustainable
Pillar 1
Unaffordability and shortage in the rental market for very low, low and medium income
households
Housing is one aspect in a complex interplay of factors in social disadvantage. Our experience in
social service delivery is that housing is often the foundational element upon which individuals and
families are able to build or re-build their lives when facing difficulty. Households who are in secure
and affordable housing are much better placed to tackle other issues they face such as financial
insecurity, unemployment, ill-health and social exclusion. The most critical obstacle faced by many
of our clients is indeed the procurement of secure, appropriate and affordable housing.
Households in the lowest 40% of income distribution usually encounter great difficulty procuring
safe, affordable and appropriate housing in the private rental market. For households in the social
housing system, client independence should not be simply measured by an exit from that system,
but rather a scenario whereby very low, low and medium income households have access to
appropriate, secure and affordable housing in either the social or private sector without entering
housing stress over the longer term. Families and individuals in the private rental market are
competing in a tight rental market where there is an extremely limited supply of suitable dwellings
available to low income households without entering rental stress. Families experiencing rental
stress may be at risk of other social disadvantage factors such as housing and food insecurity.
Vulnerable groups
Certain groups in the community may have greater difficulty procuring affordable, appropriate and
secure housing; people with a disability, older renters, young single mothers, single older women,
single parents on Newstart, Aboriginal and Torres Strait Islanders, homeless families and individuals,
and refugees and asylum seekers. These groups are at particular risk of housing insecurity and
housing stress. We are particularly concerned about the very low, low and medium income
households in these groups that are endeavouring to survive in the competitive and unaffordable
rental market.
5Summary of recommendations
Greater pathways and opportunities for client independence across the lowest two quintiles of
household income are fundamentally dependent upon the household’s access to long-term
appropriate, secure and affordable housing. The shortage of affordable housing stock for very low,
low and medium income households in both the public and private sectors is of grave concern for
our organisations. Shortage and unaffordability of current stock is having a detrimental impact on
this generation of individuals and families experiencing housing stress, insecurity, transitional
accommodation and homelessness. These consequences will inevitably impact future generations.
We make three suites of recommendations to ensure that very low, low and medium income
households have access to affordable, appropriate and secure housing:
1. Increase supply and availability of affordable housing in the private market;
2. Improve pathways, conditions and sustainability in the private rental market; and
3. Improve potential for opportunity and pathways for client independence.
Pillar 2
Fairness across the housing market
The notion of fairness in the social housing system should be considered in the broader housing
market for very low, low and medium income households. This includes current social housing
tenants, approved applicants, and households in the lowest two quintile income brackets
experiencing housing stress and insecurity in the private rental market. Together, these groups
should have access to appropriate, secure and affordable housing (private or social) without
entering rental stress. Adjustments to the current social housing eligibility criteria may have the
effect of reducing the approved applicant list, but it will not address the broader issue of vulnerable
households struggling in the private rental market, experiencing rental stress, insecurity,
homelessness and associated social disadvantage.
Summary of recommendations
Fairness for social housing clients should include greater flexibility for households that are
attempting to improve their independence and financial circumstances. It should also entail
understanding of the important economic, social and familial connections that households have in
their home areas and allow for those connections when relocation is required.
Pillar 3
Social housing stock as essential State infrastructure
Housing is essential infrastructure which provides safety, shelter and a base for day-to-day and long-
term social and familial functioning. It is paramount for the well-being of individuals and families. As
outlined in Pillar 1, safe and appropriate housing enables social and economic participation, and
affordable secure housing improves well-being and familial relationships. The shortage of affordable
dwellings in NSW presents an opportunity for both the government and non-government sectors to
invest in the social housing system for the social and economic benefit of the entire state.
6Summary of recommendations
The sustainability of the social housing sector is dependent on capital input from the government
and non-government sectors. However, an absence of input from the government will continue to
perpetuate the belief that investment in social and affordable housing for very low, low and medium
households is not a worthwhile activity and has limited or no financial or social benefits for the
community at large. Social and affordable housing needs to be treated as essential infrastructure
which triggers sector involvement and opens up diversity in the system for other stakeholder
investment.
Community Housing Providers have an important role to play in the sustainability of the social
housing system. The long term leasing and asset transferral from the public to community sector
would increase the supply of social and affordable dwellings from the community housing sector.
2. SUMMARY OF RECOMMENDATIONS
Recommendation 1: The NSW State Government appoint a dedicated Minister for Housing tasked
with a portfolio to increase the supply of affordable housing and improve housing affordability.
Recommendation 2: The NSW State Government set affordable housing targets at the state and
regional level with numerical targets, as well as facilitate and ensure that every LGA has an
affordable housing strategy in place with numerical targets.
Recommendation 3: The NSW State Government allocates 10% of the sale of any multi-unit public
asset to social and affordable residential dwellings in the greater Sydney region.
Recommendation 4: The NSW Department of Families and Community Services establish a pilot
scheme of shared equity and affordable home loans for eligible persons, including social housing
tenants, former recipients of private rental subsidies and households in the lowest 40% income
distribution.
Recommendation 5: The NSW State Government and Affordable Housing Taskforce investigate the
feasibility of the Community Land Trust model for New South Wales, in recognition of international
housing trends.
Recommendation 6: The NSW State Government reviews the SEPPs concerning affordable housing
for older people and amend so that exemptions to specific planning requirements can be made for
projects providing affordable accommodation for older people. Examples of exemptions may include
concessions on building density, the zoning of land on which accommodation can be built, and the
amount of parking that must be provided. Elements that should be strengthened to improve
appropriateness include accessibility and safety, given the mobility constraints that come with older
age.
Recommendation 7: The NSW State Government make representations to the Federal Government
to reinstate the National Rental Affordability Scheme.
Recommendation 8: The NSW State Government review the effect of state taxes and duties (and
their respective concessions) on housing rental and ownership affordability, and modify the taxation
7system accordingly to improve affordability. The NSW State Government make representations to
the Federal Government to undertake a similar review and modify accordingly.
Recommendation 9: The NSW State Government review the residential tenancy law and modify it to
ensure greater tenure for private renters and tighter regulation on rental increases.
Recommendation 10: Housing NSW restore Rentstart to its previous rate of assistance for the
payment of rental bonds and advanced rent, and exempt all new Rentstart tenants from loan
repayments for the first six months of their tenancy, in order to reduce their risk of immediate
and/or repeat homelessness.
Recommendation 11: The NSW State Government make representations to the Federal Government
to:
Raise the level of Newstart by $50 per week, in line with calls from international bodies and
business and welfare groups;
Restore Single Parenting Payments to single parents whose youngest child has turned 8 years
old until the child reaches 16 years of age;
Increase the maximum rate of Commonwealth Rent Assistance by $30 per fortnight and index
the payment to any increase in market rent price;
Continue to benchmark the Carer, Age, Disability and Veteran pension payments to 27.7% (for
single) and 41.76% (for couple) of the Male Total Average Weekly Earnings (MTAWE), if the
indexation according to the higher of the Consumer Price Index (CPI) or Pensioner and
Beneficiary Living Cost Index (PBLCI) does not reach that rate; and
Constitute an independent body to regularly review the adequacy of all Government allowances
to ensure that payments are sufficiently indexed to increase the capacity of individuals to enter
the workforce and alleviate housing stress for very low, low and medium income households.
Recommendation 12: Housing NSW use the housing waiting lists to inform a needs analysis
document for the planning and construction of new social housing dwellings and/or the
revitalisation of existing housing estates in ‘high demand’ electoral areas.
Recommendation 13: The NSW Department of Family and Community Services research the size and
profile of the unmet demand for social housing to inform a strategy to ensure that essential support
services are available and closely located to these households who can demonstrate need regardless
of their social housing tenancy status.
Recommendation 14: The NSW Land and Housing Corporation maintain existing and construct new
social housing stock across a range of LGAs in metropolitan areas, including medium and high socio-
economic areas which usually have better infrastructure and greater opportunities for
independence.
Recommendation 15: The NSW State Government increase the supply of supported housing to
assist women and their children who are experiencing or at risk of domestic violence and/or entering
8the child protection system. This should be complemented by services where support workers follow
up on families who are exiting the supported housing system, particularly if they have been
identified as being at risk of repeat homelessness.
Recommendation 16: The NSW State Government reinstate funding for the Yallah Youth Housing
Program and increase funding in general for integrated housing models assisting youth at risk of
homelessness and homeless youth.
Recommendation 17: The NSW Land and Housing Corporation and Housing NSW offer to social
housing tenants who need to be relocated due to change in circumstances, dwelling unsuitability or
asset disposal, an appropriate dwelling in the same LGA as previously tenanted. Vacant bedroom
charges or similar penalties/charges should not be enforced whilst ever an appropriate dwelling is
unavailable. Possible incentives should be explored for households to relocate when a dwelling is no
longer appropriate for them.
Recommendation 18: The NSW Department of Family and Community Services analyse and report
on its data on the profile and circumstances of households that exit the social housing system and
subsequently re-apply for a dwelling, and modify the eligibility criteria accordingly to allow for short
to medium term flexibility as households experience changes in their circumstances.
Recommendation 19: The NSW State Government allocate 20% ($4 billion) of its Rebuilding NSW
funds to investment into new and existing social and affordable housing stock, as essential state
infrastructure.
Recommendation 20: The NSW State Government commit to capital investment in social housing
for the next 10 years and make representations to the Federal Government for capital funds, in
order to generate at least 2,000 new social housing dwellings per year over 10 years.
Recommendation 21: The NSW Land and Housing Corporation and Housing NSW direct all social
housing asset proceeds into the establishment of new social housing stock.
Recommendation 22: The NSW State Government and Local Governments be required to ensure no
net loss in public and social housing in each LGA, through the use of, and adjustment to, planning
controls.
Recommendation 23: The NSW Land and Housing Corporation and Housing NSW transfer public
housing stock to registered Community Housing Providers (CHPs) with long-term leases (at least 20
years) or transfer of title so that CHPs can leverage these properties for development and growth.
Recommendation 24: The NSW Land and Housing Corporation and Housing NSW investigate the
opportunities presented by greyfield precinct developments outlined by AHURI and consider
partnerships with Community Housing Providers to deliver its outcomes.
93. WHO WE ARE AS AGENCIES
3.1 Anglicare Sydney
Anglicare Diocese of Sydney (Anglicare Sydney) is a Christian
organisation operating a wide range of community services and
programs across the Sydney Metropolitan and the Illawarra regions
of New South Wales. Our range of services include: homelessness support services, counselling and
family support services (including Family Relationship Centres); community education for families;
disability case management and respite; youth services; emergency relief for people in crisis;
migrant services including humanitarian entrants and newly emerging communities; English as a
second language classes; foster care and adoption for children including those with special needs;
aged care both through nursing homes and community services; opportunity shops providing low-
cost clothing; emergency management in times of natural disaster; and chaplains in hospitals,
prisons, mental health facilities and juvenile justice institutions.
3.2 Churches Housing
Churches Housing Inc. is the peak body for the ecumenical
church and its faith based community housing providers in the
area of affordable community housing. Churches Housing sees
churches ministering to their communities through the
development of affordable community housing. We do this by:
• Providing consultation, information, inspiration and
education in the area of affordable housing to churches of all denominations;
• Brokering partnerships between churches, government and businesses to facilitate the
development of affordable housing;
• Networking faith based Community Housing Providers with one another, the sector and the
church; and
• Advocating for affordable housing as a representative of the ecumenical church to
government at all levels.
Initially begun as Churches Community Housing in 1996, Churches Housing continues to represent
the major Christian denominations engaged in the construction, supply, management and ministry
of affordable housing across a broad spectrum of needy and disadvantaged people including low
income earners, refugees, the aged and elderly, the disabled and many other vulnerable groups.
Churches Housing represents the Catholic, Anglican, Salvation Army, Churches of Christ, Uniting,
Baptist, Pentecostal and Orthodox churches. Churches Housing attracts most of its funding from a
grant from the Communities, Homes and Place of The Department of Family and Community
Services (FaCS).
103.3 Endorsing agencies
Aged and Community Services NSW & ACT is the leading peak body
supporting church, charitable and not for profit providers of
retirement living, community and residential care services for older
people.
Anglican Retirement Villages (ARV) is a Christian not-for-profit organisation and an arm of the
ministry of the Anglican Diocese of Sydney. Following the establishment of the first village in Castle
Hill in 1959, ARV has grown and developed to become one of
Australia’s leading aged care service providers. The organisation now
cares for around 6,000 residents and home care clients, employing
more than 2,400 staff across a network of 26 villages throughout
greater Sydney and the Illawarra. ARV has a particular desire to
provide affordable and appropriate rental accommodation for seniors
at risk of being excluded from the housing market. This is done through the provision of affordable
rental units at a number of villages and at locations specifically designed to offer long-term,
affordable rental accommodation.
Anglicare North Coast delivers a range of social
welfare services across the North Coast of NSW,
including financial counselling, emergency relief,
refugee resettlement and other services to migrants, disaster recovery and mental health recovery
services. The organisation is a long term registered community housing provider, currently managing
a portfolio of approximately 50 properties. All services are aimed at assisting those in the community
who are vulnerable or disadvantaged in some way, with the need for appropriate and affordable
housing being recognised as a common area of need across all of our service delivery areas.
Anglicare NSW South, NSW West and ACT is the
welfare service arm of the combined Anglican Tri-
Dioceses (The Dioceses of Canberra-Goulburn,
Bathurst and the Riverina). Anglicare provides a range of community based services across this very
large, diverse geographical region, including homelessness and housing services in the NSW Capital
Region, the Eurobodalla and the ACT. Other main activities include foster care and residential care
for children and young people in statutory care; disability services in NSW and NDIS services in the
ACT; early education and care services; retirement villages, youth and family counselling and support
services including targeted programs for Indigenous youth; families at risk of entering the statutory
care system; and child sexual abuse therapeutic services. We also provide specific youth health
services in the ACT. Our parish partnership community services including emergency relief, financial
counselling, micro-credit finance, op shops and disaster recovery services.
11BaptistCare NSW & ACT is a leading not-for-profit Christian-based
care organisation that has been serving the aged and people living
with disadvantage for 70 years. The organisation supports
thousands of people across NSW and the ACT through more than
160 facilities and programs. From humble beginnings in 1944,
BaptistCare has grown into one of the nation's most respected care providers, employing more than
4000 staff, with a further 1000 volunteers. The organisation operates a continuum of care model
servicing senior Australians and people living with disadvantaged through a range of products and
services including retirement living, home care, residential aged care, housing, counselling and on
the ground services to support some of the communities most disadvantaged; the homeless, abused
and financially burdened.
Ecclesia Housing is a unique provider of housing and management services
with a particular focus on improving the living standards for those under
housing stress, and those with high support needs. Ecclesia Housing works in
close partnership with the church welfare sector as well as private
developers and is a not for profit company. Our portfolio of properties
includes transitional accommodation and general housing. Support for many
tenancies is provided by church and welfare agencies. Our belief is in a loving God who came to
earth in Jesus Christ to share our humanity and give an example of the potential for a full human life.
Ecclesia Housing constantly seeks new ways of engagement in realising this belief through practical
expressions of concern for others.
The NSW Ecumenical Council comprises of fifteen churches in the state
of New South Wales and the Australian Capital Territory. We are
committed to a journey of peace and reconciliation for ourselves and our
world, rediscovering our unity in the love of Christ in order that God's
love and healing may be known to all. Being together enables us to know
God more deeply, to express a common voice on issues of concern in
society, and to work together on specific projects concerning the
churches and the needs of the wider community. Through the Peace and Justice Commission, we
focus on issues such as: Asylum Seekers and Refugees; Peace Making; Caring for Creation;
Indigenous Issues and other matters as they come to our attention.
124. SCOPE OF THE SUBMISSION
4.1 Scope and definitions
As agencies at the forefront of social and affordable housing and service provision to those at risk of
homelessness we are of the view that sustainable and affordable housing is essential for those who
live on the margins and experience multiple forms of disadvantage and deprivation. Appropriate,
secure and affordable housing is foundational for the well-being of individuals, families and
communities.
We strongly believe that the social housing system cannot be considered and re-visioned in isolation
from the remainder of the housing market for very low, low and medium income households. When
renting households in the lowest two income quintiles experience transition from social to private
rental and vice versa, many encounter issues of housing insecurity, rental stress, transitional housing
or homelessness at some stage in their lifetime. For this reason, our submission will consider
households in the bottom 40% income bracket and the social and private rental markets available to
this cohort.
Households in the lowest 40% income distribution are increasingly experiencing rental stress. Whilst
there are various ways to measure housing stress, a commonly accepted method is the 30:40
indicator, which identifies housing stress when households have an income in the bottom 40% of
income distribution and pay more than 30% of that income on housing costs (DPMC 2014:10, NHSC
2013:72-73).
Many of our clients will at some stage in their lives interact with the NSW social housing system and
encounter issues of housing tenure and affordability in the social and private housing market. This
submission endeavours to address the three pillars as outlined in Social Housing in NSW: A
discussion paper for input and comment (“the Discussion Paper”):
Pillar 1: We submit that client independence be conceived as: households in the lowest two income
quintiles (whether socially or privately renting) having access to appropriate, secure and affordable
housing without entering housing stress; individuals and families having access to educational and
employment opportunities to encourage financial independence (where appropriate); individuals
and families having access to essential support services such as health, social support, public
transport; and that, after housing costs, households have an adequate income to afford essential
items including food, utilities, education, clothing, health and transport.
Pillar 2: We submit that the notion of fairness in the social housing system be considered in the
broader housing market for very low, low and medium income households: current social housing
tenants, approved applicants, and households in the lowest two quintile income brackets having
access to appropriate, secure and affordable housing (private or social) without entering housing
stress.
Pillar 3: We submit that a sustainable social housing system be conceived as: essential state
infrastructure in which government and non-government sectors invest capital funds and resources
for the benefit of social housing tenants and the community at large.
134.2 The need for affordable housing: underlying assumptions
Our organisations deliver housing services and other social services that impact the lives of people
who are disadvantaged on a daily basis and seek to address their short, medium and long-term
needs in a holistic way. Long-term housing security and affordability feature prominently in the
primary needs that our clients face. They require a stable housing foundation on which to build or
re-build their lives in the face of significant social and economic disadvantage, including disability,
mental or physical illness, unemployment, homelessness, family violence, child abuse, frail ageing,
full-time caring for a person with mental illness or disability and recovery from natural disasters. Our
clients invariably need a pathway to affordable and sustainable housing in order to lay a secure
foundation for all other aspects of their lives and those of their families.
Appropriate, affordable and secure housing is essential to the wellbeing of both individuals and
community. When people are uncertain about the sustainability of their housing situation, they
experience what the literature refers to as housing insecurity. A lack of stable, secure and affordable
housing has significant impacts on individual and family wellbeing. It can exacerbate financial
hardship which impacts on the acquisition of basic necessities including food, adequate clothing and
heating. It can lead to transience and dislocation, compromising people’s sense of place and
belonging in communities. The stress and anxiety which housing insecurity generates can lead to
relationship breakdown. Often people who live with housing insecurity are transient and may be
forced to move to locations which are cheap but have poor transport infrastructure, creating
barriers to employment. The lack of stable housing impacts on parents’ capacity to attend to their
children’s developmental needs. This compromises children’s educational opportunities and
subsequent employment options and life opportunities. For these reasons, we will canvass the issues
faced by many of our clients who are vulnerable and socially disadvantaged. For many, the issue of
affordable housing cannot be disconnected from other factors of social disadvantage.
The increasing scarcity of affordable housing for low to medium income households therefore has
the potential to seriously impact individual, family and community well being and there is evidence
that scarcity is a problem. We believe that the current state of the affordable housing market (public
and private) must be viewed together and not in isolation, and the need amongst our clientele
demands immediate, coordinated action from all levels of government.
145. PILLAR 1 A SOCIAL HOUSING SYSTEM THAT PROVIDES OPPORTUNITY
AND PATHWAYS FOR CLIENT INDEPENDENCE
Discussion Paper question: Given tenants living in social housing often experience disadvantage
which is disproportionate to other areas of the community, what measures are required to
provide tenants of social housing with pathways to opportunity and independence?
5.1 Continuity of secure, appropriate and affordable housing
Very low, low and medium income households may experience multiple forms of disadvantage as
outlined in the Discussion Paper [page 15], and Pillar 1 describes housing as one aspect of a complex
interplay of factors in disadvantage. Addressing and providing opportunities for employment,
education and social inclusion for example, will in many cases impact and improve housing security.
Whilst we concur with this proposition, we believe that the current housing market does not provide
an adequate supply or base for the assumed premise underpinning Pillar 1: increased financial
independence leads to transition from social housing into the private market, in which households
will continue to thrive and remain independent.
We submit that this premise largely ignores the experience of low income households, as it is
predicated on a housing system in which a household may easily transition from a social housing
dwelling into the private rental market; from a situation of paying 25-30% of household income for
housing costs, to a tight and competitive private rental market where in NSW 62% of the lowest 40%
income households expend more than 30% on housing (rental and owner-purchaser), and 28%
spend more than 50% of their household income (NHSC 2012:45). Transition to the private rental
market is neither easy nor affordable for households who may experience improved financial or
social circumstances but who nevertheless remain in the lowest 40% of income distribution. As such,
client independence should not be measured by an exit from the social housing system, but rather a
scenario whereby low income households have access to appropriate, secure and affordable housing
in either the social or private sector without entering housing stress over the longer term.
For such households in the private rental market, housing stress, housing insecurity, short tenancies
and regular moves, and re-location to more affordable and regional/isolated areas with less
infrastructure, can exacerbate other risk factors for disadvantage; food insecurity, reduced
opportunities for education and employment, and ill-health. Vulnerable population cohorts at risk of
rental stress and social disadvantage in the private market will be discussed under Pillar 1.
We believe that the most significant measure that can promote pathways to opportunity and
independence is that of continued access to secure, appropriate and affordable housing. Access to
such housing is an important aspect of individual and family well-being, and plays an important role
in enabling economic and social participation (DPMC 2014, SCRGSP 2015:G.2). Our experience in
social service delivery is that whilst housing is only one factor to consider when assisting clients
experiencing disadvantage, it is often the foundational element upon which individuals and families
are able to build or re-build their lives when facing difficulty. Households who are in secure and
affordable housing are much better placed to tackle other issues they face such as financial
insecurity, unemployment, ill-health and social exclusion. The most critical obstacle faced by many
of our clients is indeed the procurement of secure, appropriate and affordable housing.
15Our concern is that a discussion that concentrates solely on the tenure and profile of social housing
tenants without consideration of the unaffordability of the broader housing market will unfairly
portray tenants as dependent on social housing and unwilling to transition to the private housing
market, when for many households such a transition is unaffordable and unattainable. Conversely,
low income households that are attempting to access social housing usually need to wait until their
circumstances are critical before they can be allocated the secure and affordable dwelling that the
social housing system can offer them (DPMC 2014:10).
The affordability, supply, security and availability of housing in the broader housing market must be
considered when addressing the housing and social needs of low income households experiencing
disadvantage. Opportunity and pathways for client independence are only achievable in a housing
sector that offers affordable, appropriate and secure housing for very low, low and medium income
households.
5.2 Shortage of affordable dwellings
Improvement in housing affordability for Australians remains heavily dependent on increased
housing supply immediately and into the future. The National Housing Supply Council (NHSC)
projected that the national housing shortfall (in 2012) was 228,000 dwellings, with NSW
experiencing the most acute shortage with 89,000 (NHSC 2012:vi). The NHSC projects that the
national shortfall will increase to 370,000 dwellings by 2016, 492,000 by 2021 and 663,000 by 2031,
assuming historic demographic and supply trends continue. In 2014, AHURI estimated that Australia
has a shortage of 212,000 affordable dwellings for households in the lowest two income quintiles,
with Sydney having the greatest numeric shortage of affordable and available dwellings of all the
capital cities (Hulse et al 2014:34, 44).
NHSC reports that the total number of dwelling approvals (private and public) remains low by
historical standards, and that house building activity is generally sluggish. A slow housing market,
reflecting sluggish effective demand, is not inconsistent with an underlying housing shortage. A low
volume of new dwellings in the market potentially exacerbates the problem of inadequate supply
and is most likely to be felt by the most disadvantaged and vulnerable in society as they attempt to
enter the out-of-reach private market (NHSC 2013:8).
The housing supply gap for low to medium income households directly impacts affordability for both
private renters and purchasers. House prices are inflated with more buyers than sellers in the
market, out-pricing the lower income households. Low income renters experience unavailability of
affordable dwellings, as landlords are able to increase rents in the tight market. Lower income
households will continue to be priced out of the private market as these trends continue (AIHW
2014:20).
5.3 Unaffordability of the private market
5.3.1 First home purchasers
Home ownership for first home buyers is increasingly out of reach in the current housing market,
with the Australian property market one of the least affordable in the world. A Demographia study
comparing home ownership affordability in 9 geographies across the world found that out of 39
markets across Australia, 14 were ‘seriously unaffordable’ and 25 were ‘severely unaffordable’
16(Demographia 2014:4). In comparison with the other 8 regions on the whole, Australia’s housing was
found to be less affordable than 6 of the countries, on par with New Zealand and more affordable
than only Hong Kong. Comparison of the major markets across the 9 geographies found that Sydney
was the fourth least affordable market after Hong Kong, Vancouver and San Francisco and
Melbourne was rated the sixth least affordable market.
Nationally, house prices increased from about three and a half times the annual earnings in the late
1990s/early 2000s to over five times by 2003 (AIHW 2014:17). The ratio remains at about five or
more, depending on the location in Australia, with Sydney the least affordable. The median house
price in Sydney was $650,000 in June 2013. This was a new record high, up by $44,000 from the
previous year (ABS 2013a). Prospective first-home buyers in Sydney now face the longest wait of all
capital cities to save for a home deposit, taking an average of 5.1 years if 20 percent of income is
saved. This period fell slightly to 4.3 years for the rest of NSW (Bankwest 2011).
According to the latest Survey of Income and Housing (ABS 2013b), there has been a decline in the
number of recent home buyers in Australia (households who purchased their home three years prior
to the survey). There were 988,000 recent home buyers in 2011-12, down from approximately
1,074,000 in 2009-10 (decline of 8%). Historically, real house prices have risen at a yearly rate of 2.7
percent between 1960 and 2006 – faster than the rate of growth in household real incomes (1.9%
p.a.) (Yates et al 2007:14). The lack of affordable housing is particularly notable in Sydney, which was
recently found to be the least affordable city for key workers looking to purchase a home (Bankwest
2011:2).
The unaffordability of the private market is cited by 57% of NSW renters surveyed by the Tenants’
Union as the key reason they remain in the rental market (Tenants’ Union 2014:3). The difficulty that
first home purchasers have in the unaffordable private market further exacerbates the tight rental
market, thereby impacting the availability of dwellings for lower income households.
5.3.2 Renters
The Discussion Paper describes the social housing system ideally as a “stepping stone” for some
clients [page 17]. The difficulty with this notion is that there are extremely limited pathways
between the social and private rental market which do not entail a significant leap in housing costs.
The implicit message is that independence is gained when clients exit the social housing system, and
long-term social housing tenure is pejoratively described as dependence. Such associations largely
ignore the disconnect between the social housing system and the private rental market as they
assume that financial and holistic independence may be reasonably obtained by low income
households in the private rental market.
Almost 1 in 4 (22%) households in Australia are privately rented (Hulse et al 2014:18). Private rentals
are a competitive market and remain an unaffordable prospect for many seeking suitable housing.
The NHSC reports that compared to a decade ago, the average nominal rent paid is up by 75.8% for
houses and 91.8% for other dwellings (mostly flats/apartments). By comparison, average earnings
rose by 57 per cent over the same period and house prices rose by 69 per cent. A further factor
suggesting that the market remains tight is that vacancy rates remain low, at around 2 per cent
(NHSC 2013:7).
17NSW has the highest proportion of low income households experiencing rental stress, with 62%
spending 30% or more of their income on rent, and 28% spending more than 50% of their income on
rent (NHSC 2012:45). Previous modelling on housing and ageing undertaken for the NHSC predicts
an increase in relative demand for rental tenure (including in social housing) across Australia. This is
based on assumptions that future aged cohorts will undertake similar housing pathways or
transitions as their predecessors (NHSC 2013:57).
Sydney rental prices continue to increase in a tight rental market, notwithstanding record activity
from investors throughout 2014. Median rental prices in Sydney at the end of 2014 were $520 per
week for houses and $500 for units, with a tight vacancy rate of under 2.5% (Wilson 2014). There
does not appear to be any reprieve for Sydney renters in the near to long-term future, where the
underlying demand on Sydney rental properties continues to outstrip the supply (Wilson 2014).
The unavailability of affordable properties for purchase will continue to be exacerbated by the
increasingly speculative market in NSW, where this state accounts for 48% of investor lending across
Sydney (Nicholls 2015). Investor lending in NSW reached its highest ever at $5.5b in November 2014.
Increasing investor share in the housing market reduces the affordability for first-home buyers, who
in turn remain in the private rental market and compete for housing in a tight market.
AHURI reports that there was a loss of lower rent dwellings and an increase in higher rent properties
between 2006–11, to a greater degree than in previous years (Hulse et al 2014:24). Using the 2011
Census data, the researchers cautiously estimated that there is a shortage of 212,000 affordable
dwellings across Australia for households in the lowest two quintiles (Hulse et al 2014:34), with
Sydney having the greatest numeric shortage of affordable and available dwellings of all the capital
cities (Hulse et al 2014:44). Across Sydney, 92% of households in the lowest quintile did not live in
affordable housing in 2011, while 55% of the two lowest quintile households did not live in
affordable rental housing (Hulse et al 2014:34).
5.3.3 Commonwealth Rent Assistance
The Australian Government provides Commonwealth Rent Assistance (CRA) to 1.27 million recipients
each year (SCRGSP:Table GA.15). Rent assistance provides low income households with an additional
income to help offset the cost of private rent, and its success relies on the availability of dwellings
that can be accessed and afforded by low income households. 53% of this group were single persons
with no children, followed by single parents (21%) and couples with children (17%). CRA is indexed
twice per year in line with Consumer Price Index. 76.1% of people who received CRA paid enough
rent to be eligible for the maximum rate of CRA (SCRGSP:Table GA.23). Over the last decade, the
proportion of recipients getting the maximum payment has increased from 59% to 76.1% (NWRN
2014b:13).
Although CRA assists renters in their rental payments and decreases the number of households in
rental stress, an alarming 48.6% of CRA recipients renting in Sydney are still in rental stress after
they have received their CRA payment (SCRGSP:Table GA.23).
CRA payments are losing real value for recipients as the payment is indexed to CPI and rents have
increased at a faster rate (DPMC 2014:16). Research from RMIT and the Tenants Union of Victoria
found that between 1995 and 2009, median weekly rental prices in all capital cities rose by 41%
18(Colic-Peisker et al 2009:4). At the same time, the maximum rates of CRA remained steady in real
terms, meaning this assistance covered a smaller proportion of rent in 2009 (between 17% and
24%) when compared with 1995.
5.3.4 Rental Affordability Snapshot 2014
Anglicare Australia conducted its annual Rental Affordability Snapshot across 45 Anglicare networks
throughout Australia on 5 April 2014 (Anglicare Australia 2014).The Snapshot was carried out in
every state and territory covering a large part of Australia. In total 62,862 properties were assessed
on the collection day as to whether they were either appropriate or affordable for households living
on low incomes. The Snapshot looked at 13 household types of varying composition and payment
type and was conducted in both regional and metropolitan areas. For a property to be considered
suitable for any of the household types both tests must be satisfied (ie, suitable = affordable and
appropriate).
The Snapshot highlighted the seriousness of rental affordability across the nation, as the cost of
private rental would move most households on low incomes into rental stress and the number of
suitable rental properties on the market was minimal. Less than 1% of listed properties were rated
as suitable for any of the single households in receipt of a government payment. Couples on
Newstart with two children would find 1.4% of properties suitable on the Snapshot day. Age
Pensioner couples would find 3.6% of properties suitable on the Snapshot day.
Single people on minimum wage would find 3.2% of listed properties suitable if they have two
children and 4% if they are living on their own. Households with two adults on minimum wage and
two children would have access to 12.2% of the available listing.
The results for the Anglicare Sydney Rental Affordability Snapshot paint a grave picture for private
renters in the Greater Sydney area (Kemp et al 2014). Of the 11,397 properties available for private
rental in Greater Sydney (excluding Central Coast) on the snapshot weekend, only 21 properties
were identified that satisfied the criteria for affordability and appropriateness without placing
income support households dependent upon income support payments into rental stress. Couples
receiving the Aged Pension had only 13 suitable properties available to them across Sydney. There
were even fewer suitable properties available for other household types, including singles on the
Aged Pension (n=7 properties), couples with children on Newstart (n=2) and single parents on the
Parenting Payment (n=1). No suitable properties were found for single people on Youth Allowance,
Newstart or the Disability Support Pension.
Results revealed that having two Minimum Wage earners in a household improves the chances of
obtaining housing without being under rental stress. There were 213 unique properties identified
that would be appropriate and affordable for households on the minimum wage without placing
them into rental stress. Results were highest for couple families on the minimum wage (n=186),
followed by single persons (n=28) and single parents (n=5).
5.3.5 Household types in social housing
94% of current social housing tenants have Centrelink Benefits as their primary source of income,
with 5% listing wages as their primary source of income [Discussion Paper, page 22]. NSW Social
19Housing currently houses 150,000 households, assisting approximately 290,000 individuals
[Discussion Paper, page 5]. A further 59,500 approved applicants are waiting for a social housing
dwelling [Discussion Paper, page 22], which does not include the unexpressed demand of
approximately 133,847 NSW individuals for social housing (Audit Office 2013:45).
For those tenants, approved applicants and households on low incomes who find themselves
searching for an affordable and appropriate private rental property in the Greater Sydney area, 21
properties were available to those on Centrelink benefits as at 5 April 2014 (Kemp et al 2014).
Households that fare better on minimum wage will still struggle in the tight and competitive rental
market, with 213 properties available from the 11,397 properties listed for rent.
AHURI research amongst public housing tenants who exited into the private rental market indicates
that tenants encountered financial stress, insecurity of tenure and numerous rental property moves,
which were more significant in metropolitan areas (Wiesel et al 2014:44, 46). The gap between
public and private rental costs is significantly higher in metropolitan areas, making it difficult for
social housing tenants who gain employment to find incentive to exit from a relatively secure and
affordable social housing dwelling (Wiesel et al 2014:48). Current public housing tenants view their
low income (76% respondents) and housing unaffordability (52% respondents) as the two major
barriers for those tenants who wish to rent privately or own a property (Wiesel et al 2014:29).
As social housing clients experience opportunities for employment and improved financial
circumstances, allowance must be made for the likelihood that households on minimum wage and
similarly low incomes will continue to encounter housing stress and insecurity in the private rental
market.
5.3.6 Insecurity of tenure
Whilst the flexibility of the private rental market suits some households, it is not a choice that others
would voluntarily make. Having been priced out of home ownership, many low to medium
households reside in private rental dwellings out of necessity, not choice (Tenants’ Union 2014:3).
Private renters generally experience less control over their property compared with owners, as their
tenancies are less stable and secure than their social housing counterparts (Kelly 2013:7,19).
5.3.7 Housing NSW products and services
As outlined in the Discussion Paper [page 14], Housing NSW (HNSW) offers a range of products and
services to assist eligible low income households enter, re-enter or continue in the private rental
market.
The Rentstart scheme is managed by HNSW and aims to assist low income households access
accommodation in the private rental market. Currently the scheme offers an interest-free bond loan
that covers up to 75% of the bond, advance rent, help for tenants who need to move if they become
ineligible for public housing, short-term financial support for clients in rental arrears facing eviction
and temporary accommodation.
Rentstart was modified by HNSW in 2012 to be advanced as a loan payment only. Previously it was
provided as a grant, and any unclaimed money returned to the funding pool at the end of the
tenancy. Now tenants will repay the loan to Housing NSW on a fortnightly basis usually over 12 or 18
months. In exceptional circumstances a 36 month payment plan may be offered. The payment plan
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