A community housing provider says Labor’s federal election pledge would help meet the housing needs of low to middle income earners in Wollongong.
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Australia’s housing shortage would get a $6.6 billion fix from a Labor plan to build thousands of new homes and bring down rents for those in need.
Revealed as part of Labor’s long-term plan for affordable housing and more construction jobs at the ALP Conference in Adelaide on Sunday, Opposition Leader Bill Shorten released details of its plan to subsidise rents for low and middle income earners.
A major component of the announcement is a significant investment in affordable housing.
Labor unveiled a 10-year national plan to build 250,000 new units and houses – with 20,000 new units and houses estimated to be built in the first term of a new government.
The plan supports rental affordability by offering 15-year subsidies ($8500 per year) to investors who build new houses – conditional on them being rented at 20 per cent below market rent.
Labor estimates a family paying the national rental average of $462 a week could save $92 a week under its plan.
Michele Adair, CEO of community housing provider the Housing Trust welcomed the Opposition’s recognition of the rental affordability crisis.
“The strategy is an important commitment towards meeting the housing needs of low to middle income earners in Wollongong,” she said.
“We have long way to go to meet the needs of the Illawarra, but the announcement brings us closer to reaching our target of 5000 homes within the next decade.”
Labor is confident their plan will provide investors with certainty to build – citing the results of the National Rental Affordability Scheme which has attracted $12.9 billion in investment nationally since 2008.
Housing Trust built Central Gardens, a 71-home villa and unit complex in Shellharbour, under the NRAS scheme in 2016.
“We can’t provide subsidised housing without a subsidy,” Ms Adair said.
“Access to housing is one of the biggest indicators of the widening wealth gap between generations, and this is something we can no longer ignore.”
Labor’s policy follows the Liberal government’s establishment of the National Housing Investment Corporation in June, which will make $1 billion in low cost building and constructions loans available to Tier 1 community housing providers like the Housing Trust.
“All three levels of government, housing providers and other support agencies must work together to solve this growing problem,” Ms Adair said.
“The only way to solve this problem is through collaboration and innovation.”
The housing policy is reportedly made possible by the increases in tax revenue in Labor’s election platform, including $32 billion over a decade from changes to negative gearing and capital gains tax as well as $56 billion over a decade from tighter rules on tax refunds from dividend imputation on shares.
Meanwhile, the Community Housing Industry Association welcomed the prospect of a long-term affordable rental incentive program which would be large enough to start making a meaningful difference to housing affordability.
“This is one of the central pillars of CHIA's National Affordable Housing Plan that was released late last month,” they said in a statement.
However, Treasurer Josh Frydenberg said that “Labor’s re-run of its failed affordable housing scheme is nothing more than an admission that its big new housing tax will have a negative impact on housing affordability and supply”.
“Labor’s National Rental Affordability Scheme (NRAS) was rorted, ripped off taxpayers and was strongly criticised by the Australian National Audit Office (ANAO) after it was first introduced in 2008,” he said.
“It did not work then and it will not work now. Labor has clearly learned nothing from its past failures and is putting in place a re-run of Rudd’s dud.
“If Labor really cared about housing supply, they would scrap their ill-conceived plan to abolish negative gearing as we know it.”