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New Directions

The community housing sector has developed considerably to become an innovative, professional, and diverse sector.

But it is now in the throes of major change and is about to experience even more.

As housing affordability continues to decline across Australia, the sector is positioned to take a broader role in delivering low cost housing. In addition to very low income households and those with complex needs, the sector will increasingly expand its role in providing housing that is affordable to low to moderate income households.

There are five major changes underway that will change the face of housing associations in NSW.

  • New kinds of housing associations – brought about through mergers, new partnerships and new group structures
  • Major growth – through a NSW Government target, the development of 5,500 propoerties through the Nationa Building economic stimulus and through new private investment incentives, the National Rental Affordability Scheme.
  • Taking on management of public housing
  • New business – a number of associations will move beyond property and tenancy management into property development of low cost housing.  This in turn is producing new partnerships.
  • New legislation to provide certainty and assurance to stakeholders, investors and partners.

 

New kinds of housing associations

Across the country governments are directing investment into growing providers.

At the same time we are seeing mergers and consortia emerging.  The average association in NSW manages around 1,000 houses, the largest is over 4,000 and we can expect a number of other large associations managing around 4,000 properties to be well established within a few years.

These are organisations that mix a social mission with a commercial capacity.  Their directors include many with strong business and development experience.

Rapid growth

Considerable growth in the whole sector has been proposed for the near future – more than doubling the current 18,000 homes being managed.  While much of this growth will be focussed on a few large associations, it will be complemented by the continuation of services that are responsive to tenant and community needs, and the diversity of providers and housing types.

In 2007, the NSW Government launched a strategy for the sector’s growth. Planning for the Future: New directions for community housing in New South Waleswas launched after extensive consultation, at the 25th Anniversary of housing associations in NSW, in November 2007. The strategy demonstrated strong governmental support for the sector, and outlines proposed growth from 13,000 to 30,000 properties. With the Nation Building stimulus, this target has almost ben reached 5 years ahead of time.

Much of the future growth will involve housing associations taking on debt to leverage the public investment and expand the supply of low-cost housing.

Managing public housing

In addition to new funding for new community housing supply, growth will come from the management of tenancies and properties being transferred from public housing. 3,500 such properties have been transferred over the last 2 years bringing about major new efficiencies and capacity into the whole social housing system.  Similar transfers are expected over the next decade.

New business – development and partnerships

In the past only one association in NSW undertook a regular program of affordable housing development.  This is City West Housing Company.  But now growing associations will also become developers – along with their current tenancy management role.

Because of their charitable tax status and considerable experience, community housing providers are uniquely positioned to engage in more cost effective development. 

At the same time, many will engage in innovative partnerships and business models with the government and private sector to increase housing supply.  We have already seen a housing association form part of the consortium which is undertaking the redevelopment of a public housing estate as Public Private Partnership.

Asset ownership

As well as transferring the management of tenancies that were previously managed by Housing NSW, title to a number of those properties is being vested with community housing organisations. In addition, ownership of around 5,500 new Nation Building properties is also being vested.

This gives providers a strong balance sheet. At the same time, they will be leveraging these assets to expand the supply of affordable housing.

New legislation

For some years, the performance of community housing has been supported by an externally accredited quality assurance system, and more recently government registration and oversight of performance. On the 24th October 2007, the registration and regulation of community housing was embodied in Legislation. More info  The new Regulatory Code itself was gazetted in 2009.

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