Snapshot highlights need for expansion of NRAS and a National Affordable Housing Plan

Australia’s peak community sector body and leading housing groups today called on the Federal Government to commit to continuing the National Rental Affordability Scheme as part of a national affordable housing plan, following the release of the Anglicare national Rental Affordability Snapshot.

The annual snapshot shows that while the number of houses advertised for rent has increased in the past year, the number affordable for those most in need is extremely inadequate, virtually non-existent.

According the Australian Council of Social Service (ACOSS), the Community Housing Federation of Australia (CHFA), and National Shelter, this neon sign of housing distress should light the way for the Abbott government to extend the National Rental Affordability Scheme (NRAS).

ACOSS CEO Dr Cassandra Goldie said, “Clearly the market is failing when it comes to providing a market for low-cost and affordable rental properties. NRAS has been designed to respond to this market failure and attract private finance to increase the supply of affordable rental housing. While the current scheme is not perfect, it has shown that there are ways to get the private market interested in different types of housing for a modest government outlay.”

“The benefits flow to low and moderate income households not eligible for other housing assistance but who are priced out of the private rental market. It is creating a new form of housing that moves beyond social housing and supports households doing it tough,” Dr Goldie said.

CHFA Chief, Carol Croce, said that “despite the additional supply made possible by NRAS, it’s clear this is just a start. But NRAS is doing what it was intended to: promote investment at the affordable end of the rental market where it’s needed.”

“NRAS has been a significant driver in the expansion of not-for-profit community housing organisations, who are both developers and tenancy managers of NRAS dwellings. Indeed, more than half of all NRAS recipients are not-for-profit community housing organisations,” she added.

A number of media reports have looked for alleged failings and abuses of the Scheme, which has built over 20,000 new affordable rentals and cast doubt on its future.

According to National Shelter head Adrian Pisarski, “all new government programs require tuning. NRAS is tracking better than the US Low Income Housing Tax Credits which took seven years to gain acceptance as an institutional asset class.”

“The Anglicare Snapshot proves the need for Government to build the supply of affordable housing. Any program that leverages private investment to do this means better value for the taxpayer. The Anglicare Snapshot is evidence we need to build on the strengths of NRAS rather than abandoning what is a fundamentally sound program.

“Ultimately, we need to have a national affordable housing plan with a dedicated housing minister if we are to begin to address Australia’s housing affordability crisis,” Mr Pisarski said.

Media Contacts:
Cassandra Goldie, ACOSS – 0419626155
Adrian Pisarski, National Shelter – 0417 975 270
Eddy Bourke, CHFA – 0407 211 413

A National Affordable Housing Plan would include:
1. Developing a National Affordable Housing Strategy
2. Having a dedicated Cabinet Minister who can coordinate national policy levers and cooperate with states and local authorities
3. Treating housing as an infrastructure investment rather than wealth creation or welfare
4. Tax reform to ensure new supply of affordable rentals and which does not inflate house prices
5. Expansion of the National Rental Affordability Scheme based on institutional investors
6. Planning coordination with states and local government
7. Improved housing tenure for renters and certainty and security for owners of rental property

In addition a national housing plan must include:
• Addressing the gross inadequacy of income support payments such as Newstart – currently $36 a day and has not been increased in 20 years.
• Increase the maximum rate of Commonwealth Rent Assistance (CRA) to assist people on low incomes to meet rising rental costs.

NRAS was introduced by the Labor Government in 2008 with support from the Coalition and the Greens and provides financial incentives over a ten year period for new dwellings that are rented out at less than 80% of market rent to low and moderate income earners.