Monthly digest on housing affordability and homelessness – Apr/May 2019

May 10, 2019

This is a monthly digest of interesting articles, research reports, policy announcements and other material relevant to housing stress/affordability and homelessness – with hypertext links to the relevant source.

Lord Mayors of Australia’s two biggest cities launch call for action on Australia’s homelessness and housing affordability crisis. The Mayors of Sydney, Melbourne and Adelaide have joined the chorus of people calling for action, in the wake of Anglicare’s most recent annual Rental Affordability Snapshot, which presents a grim view of rental affordability for those on lower incomes.

NSW partners with Mission Australia on a new social impact investment initiative designed to prevent people emerging from hospitals, mental health facilities and drug and alcohol treatment centres from becoming homeless. The NSW Government will pay Mission Australia for the six year $20m “Home and Healthy program” once agreed goals and outcomes are achieved. The program is expected to help up to 1,200 people.

Tasmanian Parliament to hold wide-ranging enquiry into the State’s housing and homelessness crisis, following a successful motion by the Labor opposition.

Labor promises $8m to tackle youth homelessness. As part of his election pledge, Bill Shorten has promised to provide $8m support over 4 years to Father Chris Riley’s “Youth off the Streets” charity across three eastern states, helping indigenous youth in regional NSW, youth migrants in Melbourne and kids from refugee backgrounds in Queensland and western Sydney.

Spotlight on Youth Homelessness. The Create Foundation highlights some of the stark figures around the incidence of youth homelessness, including the proportion of young people leaving state care who end up homeless. It is estimated that extending care supports to age 21 (from the current age 18) would halve the percentage from the current level of around 40%.

Build-to-rent industry in Australia not viable without tax changes. Panelists at a recent “Future Housing Outcomes for Australia” conference agreed that build-to-rent (BTR) could play an important role in plugging Sydney’s rental housing gap – just as it has in the US and UK – but that several hurdles still stand in the way of developing the BTR market in Australia, including our land tax rules and the Managed Investment Trusts (MIT) tax rules for foreign investors in residential housing.

Housing must be treated as a human right, according to Leilani Farha, UN special rapporteur on adequate housing, when she visited Toronto, Canada. Farha travels the world to promote housing as a human right, rather than simply a commodity for investors to buy and sell.

Property taxes such as stamp duty are inefficient and make housing much less affordable, according to Property Council of Australia CEO, Ken Morrison. He is not alone in calling for reform of property taxation, with many leading academics and economists advocating replacing stamp duty with some form of broad-based property tax. See for example this article by Professor Richard Eccleston in P&I, and this research paper by AHURI.

The type of housing we are going to live in is being transformed, says a recent report from Boston Consulting Group (BCG) titled “Building the Housing of the Future”. The report analyses 10 key trends, covering both the demand and supply side of the housing market, and amongst other things points to increased urbanisation, lower property ownership, widespread housing shortages, and the need for higher residential density in urban areas.

AHURI’s recent research report, Housing outcomes after domestic and family violence, points to the special housing challenges faced by women and children fleeing such violence. Although a range of support is available, it comes as no surprise that existing support programs cannot compensate for the lack of affordable, adequate, long-term housing for such victims. This is leading some women to make the decision to return to, or remain in, a violent relationship.

The Housing section of the Grattan Institute’s Commonwealth Orange Book 2019 finds that Australia has amongst the least housing stock per adult in the developed world and, among OECD countries with comparable data, Australia has experienced the second greatest decline in housing stock relative to the adult population over the past 15 years. The report notes that almost half of low-income earners in Australia’s private rental market suffer rental stress, especially in the capital cities and that almost 50 in every 10,000 Australians were homeless in 2016, around double the comparable rate in the UK. A range of reforms are suggested.

According to progressive thinktank the McKell Institute, Labor’s $6.6bn housing affordability policy could save federal and state governments up to $10.8bn. The estimated savings are based on PwC analysis covering a 10 year period, and assume (at the upper end of the savings forecast) that all of those housed in Labor’s proposed new 250,000 affordable homes (created over a decade) come out of crisis accommodation or homelessness.

A recent article in The Conversation indicates that informal and illegal housing are on the rise, as our cities fail to offer affordable housing. The article summarises the findings of a new Sydney University study which shines a light on what has hitherto been a relatively hidden and therefore unmeasured part of the housing market. The study found more people – particularly low-income earners – are living in shared rooms or dwellings, often in overcrowded and unsuitable conditions, and that illegal dwellings are on the rise in Sydney. Those aged over 45 now amount to 20% of sharers and many more older women are forced to share due to lack of means.

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