This post continues my discussion on the new Federal Government policy aimed at creating more affordable rental housing looking at the social context and benefits of the initiative.
As a member of the Property Council of Australia’s Build-to-Rent Roundtable, I like many others have a deep interest in how best to deliver Affordable Housing. The policy will face many hurdles but I suggest it’s also important to keep in mind the social benefits. Not only to those who might access this form of rental housing, but also the wider community.
While those benefits might include better and more employment opportunities, an improved quality of life and a much wider choice of accommodation, it would be useful to first consider how individual eligibility might be defined, and just who could secure this form of housing. The Property Council have provided some guidance:
The first question is the link between the size and location of properties, will it be possible (or fair) to have buildings in high-cost and high-demand areas and if so how is this reflected in rents and eligibility.
Then how should demographics be taken into consideration, looking at factors such as: type of employment (keyworkers) and access to employment, age, incomes, nature of income and key areas of demand.
Employment is a key issue and affordable rental housing has the potential to enhance labour mobility which can help reduce pressures on the housing market if employment opportunities are more widespread.
Then when looking at individual tenancy terms consideration needs to address the lease term (10 years being one option), bond payments, including the bond term and amount and interest and how tenancies would fit within for example strata building, including mixed-use strata buildings.
These questions are also again tied up in the management expertise of the provider institution, investor and property manager. In this context, we need to consider programmed maintenance and cost effective daily management are key issues.
If long-term rentals and premises are not well maintained this can lead to social friction and be a drag on the investment itself. Professional management capabilities extending to solid community engagement is a reoccurring theme that’s important for investors, tenants and the wider community.
Planning an Underlying Issue
For investors in MITs I’ve already highlighted the importance of planning and stable government policy. And planning is also an underlying issue in helping to deliver desirable and affordable rental housing options that tenants will want to live in and enjoy.
As a focus development planning, should aim to encourage housing projects that are sustainable and inter-woven with the wider community. Having larger pockets of one housing, including affordable housing, in concentrated areas is not always a good idea, at least that’s what local history tends to suggest.
Planning needs to deliver a range of housing types, so that a mixed and diverse demographic results and is capable of renewal over time. The mix could include high-rise, medium and low-density options. This will better cater for a mixed demographic profile and in some cases, regenerate areas and create commercial and employment opportunities.
The role of planning is vital in helping to deliver affordable housing options that are attractive to large scale investment. Streamlined planning will also help cut the delivery time of new projects, and if major time savings are achieved this will deliver rental incomes sooner and reduce holding costs, both vital elements if helping to make the investment a viable option. This is also important from the tenants point of view so that waiting times are reduced.
In my next post, I will highlight how some projects in the UK have been planned and designed to deliver very livable accommodation and the result is desirable long-term investments and homes.