City Futures Blog

News and research in housing and urban policy, from Australia’s leading urban policy research centre.

City Futures Blog random header image

Why public housing is stigmatised and how we can fix it

Posted by on August 7th, 2020 · Housing, Social housing, Uncategorized

Alistair Sisson, UNSW and Pratichi Chatterjee, University of Sydney

Social and public housing is intensely stigmatised in Australia and has been for several decades. Estates in particular are often labelled “ghettos”, framed as places of danger, drugs and vice.

This stigma can lead to discrimination against tenants and can harm their sense of self-worth, as shown in Australia and around the world.

But it’s not just the Pauline Hansons of this world who are responsible for reinforcing stigma.

Stigma is the product of government policies. It also serves government policies, like privatisation and redevelopment. Until we recognise that, we’ll struggle to remove it.

The source of the stigma

Public housing is stigmatised in many different ways, as we discovered when reviewing a decade of policy documents and media coverage.

Since the 1970s, public housing has gone through a process of residualisation due to the declining number of dwellings and the tightening of eligibility criteria. In other words, it has become home to more and more people who are marginalised and disadvantaged and portrayed as:

[…] a detached underclass unwilling or unable to engage with labour market opportunities or mainstream norms and values.

There is also a view that concentrating disadvantaged people in one area can worsen the problems they face. Common but contested ideas about concentrated disadvantage and neighbourhood effects can lead to the stigmatisation of whole estates or neighbourhoods.

Racism has also added to the stigma of some estates over the last 50 years, as access for Indigenous people has improved and as non-white migrants have been permitted to immigrate.

Decline and design

Public housing can sometimes stand out due to poor maintenance, particularly in gentrifying areas where private housing is new or renovated.

Brutalist towers in inner cities and back-to-front Radburn estates in outer suburbs can also contrast with their wider neighbourhoods.

These stereotypes stem from policies from the mid-1950s to the early 1970s that encouraged public tenants to buy their homes.

But residents who lived in apartments were excluded from such schemes, and cheaply built homes on the urban fringe were less attractive to buy. So these two types of estates became the dominant images of public housing, especially in Sydney and Melbourne.

These policies also reveal how public housing is viewed as inferior to home ownership. Home owners are portrayed as independent and good citizens, despite extensive government subsidies.

Stigma in action

The stigmatisation of public housing has been reflected in several recent government policies.

For example, the shared spaces and facilities of the high-rise public housing towers in Flemington and North Melbourne, in Victoria, were used as justifications for the hard lockdown during the coronavirus outbreak. The tenants were represented as an exceptional risk requiring an exceptional response.

Police deployed 500 officers to enforce a lockdown of unprecedented severity, while apartment residents in other hotspots had more freedoms and forewarning.

The relocation and privatisation of public housing in Millers Point, in Sydney, NSW, was another case of governments using stigma to justify policy.

The NSW government claimed residents received huge subsidies compared to other public housing tenants. It argued this money could be used to fund more housing in cheaper places.

But as the Tenants’ Union of NSW pointed out, these subsidies were made to seem larger than they were by including the difference between market rents and tenants’ rents. The subsidies weren’t paid to residents and didn’t reflect the cost of providing housing.

Yet The Daily Telegraph’s Miranda Devine argued tenants living in higher-value areas were responsible for the long waiting list for public housing.

This misrepresents the huge magnitude of public housing shortages and distracts from chronic under-funding.

The break-up of public housing

Stigma has also been used to justify estate renewal. The demolition and redevelopment of estates like Waterloo in Sydney and Carlton in Melbourne, along with many others around the world, has been justified by the argument that tenants’ disadvantage can result from the cultures or environments of estates.

Breaking them up is presented as a solution to disadvantage and anti-social behaviour.

These arguments divert attention away from government failures in reducing poverty. They also mask the economic and financial objectives of redevelopment, which research suggests are the primary drivers.

Meanwhile, the harm to tenants is dismissed as a cost worth paying for new or better housing.

Solutions to stigma

By shifting blame for various problems onto public housing tenants and estates, stigma reinforces the status quo of inadequate funding and thus poor maintenance, dwindling supply and cannibalisation through redevelopment and privatisation.

It also obscures the culpability of governments and the failure of markets to provide affordable housing, adequate incomes and social support.

To destigmatise public housing, fundamental changes in our housing system are needed. Better design, maintenance and stories are helpful, but can only do so much.

Part of the solution is to end the preferential treatment of home ownership and to treat different tenures equally through housing and tax policy. The security, stability, quality and profitability of your home should not depend on whether you own it or rent it from a private landlord or a social one.

This starts with upgrading public housing and building much more for the hundreds of thousands on waiting lists and the many more who are struggling in privately rented or mortgaged homes.

Alistair Sisson, Postdoctoral Research Associate, City Futures Research Centre, UNSW and Pratichi Chatterjee, Postdoctoral Research Associate, School of Architecture, Design & Planning, University of Sydney

This article is republished from The Conversation under a Creative Commons license. Read the original article.

A dog’s breakfast? Why rental pet reform is needed

Posted by on August 5th, 2020 · Government, Guest appearance, Housing, Private rental, Strata, Tenancy

Person holding French Bulldog and plant sitting on couch in apartment.

By Ebony Stansfield, UNSW Newsroom. Originally published by UNSW Newsroom.

NSW pet tenancy laws do not reflect the needs of society, with strata by-laws impacting the vulnerable, say UNSW experts.

As COVID-19 restricted them to working from home, Alexandra Foster and her partner decided it would be perfect to foster an animal.

This is when they met Pepper, their second foster puppy – a Staffordshire cross – who they ended up adopting.

“Being under COVID restrictions and not being able to see friends and family was difficult but having Pepper made dealing with the hard aspects of the lockdown a lot easier,” Ms Foster says.

During the unprecedented circumstances of a global pandemic, with unemployment rising and forced social isolation, many found solace in the company of an animal.

Australia has one of the highest rates of pet ownership in the world and a report by Animal Medicines Australia from 2019 states three-in-five households have a pet.

The latest housing occupancy figures from the Australian Bureau of Statistics, from July 2017 to June 2018, state renters make up 32 per cent of Australian households. But rental rules do not always favour companion animals and many people have to choose between their home or a pet.

Most tenancy agreements include a clause prohibiting tenants from keeping pets without the permission of the landlord. And many landlords and agents refuse permission out of hand. The law governing tenancy agreements, the Residential Tenancies Act 2010, does not require this clause – but nor does it rule the clause out.

Home is where people should have autonomy – where they decide how to live their lives, who they live with and what they live with, says Dr Chris Martin from UNSW City Futures Research Centre.

“The ability of tenants to have some autonomy around keeping a companion animal is part of that,” Dr Martin says.

Reform around pet ownership would mean our rental housing market is more respectful of autonomy as responsible adults, he adds.

“Responsible adults shouldn’t have to ask another adult if you can keep a cat or a dog.”

Dr Martin says restrictions around pets have always an additional item in leases that has been left up to landlords. Whereas other terms of the tenancy agreements, such as landlords being required to conduct repairs and providing premises which are in a reasonable state of repair, are dealt with by legislation.

“That’s been set as a matter of protecting tenants as vulnerable consumers … the pet term hasn’t been addressed that way,” Dr Martin says.

“So often that’s just declined without the landlord even giving it any thought … without the agent even going to the landlord about it,” he continues.

“It’s sort of a cheap-and-nasty risk avoidance.”

Staffordshire cross Pepper lying in the grass at the park

Pepper, Alexandra Foster’s Staffordshire cross puppy.

Dr Martin says the issue of pets has risen in agenda reforms.

Both ACT and Victorian jurisdictions have changed their laws to be more accommodating of tenants who want to have a pet.

“That sort of reform is something that NSW could adopt.”

But Dr Martin says one step further could be leaving it up to the tenants to decide whether they could keep a pet and comply with other obligations they have under the tenancy agreement.

“A tenant already has an obligation not to cause a nuisance. A tenant already has an obligation not to damage the property.”

How do strata schemes fit into this debate?

“If you are renting a building you are bound by the strata by-laws, they’re actually an implied term in your lease,” says Associate Professor Cathy Sherry from UNSW Law.

A/Prof. Sherry says that when a landlord bans a pet, at least it’s inside a property they own, but when a strata scheme bans a pet its members are banning pets inside properties they do not own.

A/Prof. Sherry says the level of dispute that exists around pets is just “extraordinary” when issues should only be raised about problem pets.

The commencement of the Strata Schemes Management Act 2015 in November 2016 changed the model by-laws on pet ownership in strata buildings, but there is no obligation to use the model by-laws.

Section 139(1) says a by-law must not be “harsh, unconscionable or oppressive”, which some people have used to challenge blanket pet bans – although last month, the Civil and Administrative Tribunal decided strata by-laws could prohibit pets, in the case of Strata Plan No 58068 v Cooper.

The tribunal ordered the owners of a miniature Schnauzer dog called ‘Angus’ from their lot in strata scheme 58058 within 28 days.

Assistance animals in strata schemes

“There is a dreadful circumstance in relation to assistance animals and strata schemes that wouldn’t exist if you couldn’t ban pets,” says A/Prof Sherry.

Under section 9 of the Disability Discrimination Act, she says, an assistance animal does not have to be professionally trained, and it does not need papers to state it’s professionally trained.

However, under the Act strata schemes can require people to prove that an animal is an assistance animal.

“That means your neighbours asking for highly confidential private medical information and then making a completely uninformed lay judgment about whether you should be able to keep your assistance.”

NSW housing strategy: challenges to be faced, objectives to be owned

Posted by on July 24th, 2020 · Uncategorized

The NSW Government plans to publish a comprehensive housing strategy. This is the Executive Summary of the full CFRC submission to the strategy’s formulation.

Three components are fundamental to any strategy: the setting of goals, the identification of actions to achieve those goals, and a plan for the mobilisation of resources to implement the specified actions. In this submission we summarise:

  • The housing challenges we believe the 2020 Strategy should address
  • The primary policy objectives the Strategy should adopt, and
  • The powers and policy levers the Government could wield in pursuit of such objectives.

Strategy challenges

Challenge 1: Expanding housing stock to meet future needs

In expanding housing stock to meet future needs, the 2020 Strategy needs to recognise and address the changing size and profile of the state’s population. In doing so, it will need to set out population and household projections more fully than in the Discussion Paper. In the light of the COVID-19 impact on international migration, this analysis will need to incorporate scenarios that allow for the possibility that future flows will be lower than previously forecast.

Beyond this, the strategy should also contemplate the possibility that future population growth might be partially accommodated by making more effective use of currently under-utilised housing stock. With these points in mind the Strategy should extend beyond the Discussion Paper in making a reasoned case for the scale of additions to the dwelling stock considered essential in gross numerical terms.

Similarly, by comparison with the Discussion Paper, the Strategy will need to lay greater emphasis on the housing provision implications of population ageing, recognising that older Australians are a cohort whose growth rate is over three times that for either children or young people. The Strategy must also take a view about the expected geography of future dwelling growth in terms of housing need and requirements across the state, underpinned by an analysis of the spatial structure and dynamics of the housing market as well as recent changes in the geography of employment and projections for the strategy period.

In advocating measures to shape new housebuilding, the Strategy will also need to address concerns arising from ongoing contraction of home ownership and to factor in changing consumer preferences related to housing.

Challenge 2: Addressing existing housing needs

The Discussion Paper appropriately acknowledges that rental stress, homelessness and the undersupply of affordable housing pose critical challenges for government. The Strategy itself will need to spell out the associated implications for the planning and funding of future housing provision much more cogently and specifically. The Paper’s silence on the extent of the state-wide shortfall in social and affordable rental housing is a fundamental weakness. In gauging the necessary scale of required action to address this issue, the Strategy will need to quantify recent social/affordable housing construction, and to project likely completions that can be expected in coming years – e.g. anticipated output from the Communities Plus program.  This must, of necessity, include strategies and polices to address the affordability shortfall among lower income households, measures that extend beyond current housing policy and planning frameworks.  

From the housing portfolio management perspective, the Discussion Paper devotes remarkably little attention to the state’s existing social housing sector and – in particular – the undoubted challenge this presents in terms of managing and maintaining (let alone expanding) an ageing body of stock. As a major ongoing renovation program, Communities Plus is again relevant here. Considering its importance, the Housing Strategy would be expected to focus substantial attention on the program’s progress and prospects for delivering both replacement and additional social housing – benchmarked against program aspirations as originally stated in 2016. More broadly, the Strategy will need to include a comprehensive analysis of public housing property condition that quantifies the existing works backlog in dollar terms – or, at the very least, commits to a time-specific program to develop such an assessment and to devise associated options for addressing the issue.

In recognition of mounting climate challenges, the Strategy should also explicitly consider the quality and performance of new and existing housing. This should extend beyond recognition of the problems of building defects to consider how buildings can be designed, built and managed to prolong their functional life. It should consider how new housing can deliver longer term utility cost reductions for householders while minimising consumption/ waste and maximising energy efficiencies and energy management, both in their construction and throughout their lifecycle (including through adoption of renewable energy technologies), for example, through a thorough review end extension of BASIX.  These policies also need to be extended to include existing dwellings so that the entire housing stock can be made compliant with modern standards.

Improving housing quality and performance will require explicit consideration of asset management and building maintenance practices. This is especially important in multi-unit (apartment) housing across both the private and social housing stock.

Challenge 3: Inequality and economic productivity

In its ongoing evolution over the past 20-30 years, Australia’s housing system has been increasingly contributing to inequality in living standards as well as in wealth distribution. Moreover, there is growing evidence that aspects of housing market operation are impairing overall long-term economic productivity, most noticeably in the formation of human capital and especially with regards to the perceived benefits of greater agglomeration through increased urban density. This implies a much greater recognition of the need to integrate housing, planning and infrastructure policy than has been achieved to date, to ensure that public investment and intervention in the housing system maximises ‘whole of economy’ productivity gains.  While some policy levers may lie with the Commonwealth Government, the 2020 Strategy should contemplate what actions could be within state government powers to achieve a more holistic approach to future housing development that builds productivity. 

Strategy objectives

Crucial in the 2020 Strategy will be the adoption of high-level objectives that logically flow from the strategic housing challenges as identified and defined. As acknowledged in the Discussion Paper (p5) the Strategy will ‘set an overarching 20-year vision for housing in NSW’. If the elements of this vision are to have any meaning, they will need to be specified in clear and ambitious terms. Although by no means an exhaustive list, this submission proposes five possible objectives that the Strategy could embrace as follows.

Objective 1: The market functions more smoothly and housing stock is used more efficiently

Crucially, this includes the need to minimise the market volatility so strongly embedded within the system as it currently operates. This results in the construction industry wastefully and inefficiently gearing up and winding down in response. It also gives rise to developer business management practices that problematically under-invest in skills and technology development and embody short-term approaches to dwelling design and construction. While new policy are being implemented in NSW to deal with aspects of building quality, governments can further counter these problems by discouraging property and land speculation – e.g. through land tax reforms and/or planning system adjustments, including greater intervention to manage planned precinct outcomes and value-sharing arrangements. Greater market stability would also be served through diversifying the housing supply system to enhance representation of not-for-profit providers and institutional investors.

Objective 2: Housing system impairment of economic productivity and equity is reduced

As advocated above, there is a case for government to include a strategic priority to reshape the housing system to minimise impairment of economic productivity. Again, this is compatible with current political orthodoxy. Since rising spatial inequality is increasingly viewed as antithetical to economic growth, these two issues are logically interconnected. Although, as acknowledged above, the relevant tax policy levers are primarily held by the Commonwealth Government, this should present no bar to a state or territory government advocating for their reform.

Objective 3: A more diverse range of housing forms enhances consumer choice

Australia has seen a growing polarisation between high density development – primarily but not exclusively in designated centres and corridors – and 1-2 storey detached suburban housing on the urban fringe with little change in the proportion of medium density options. Probably as much or more than any other city, Sydney would benefit from increased provision of medium density townhouse or mansion house style development to increase choice in terms of both housing type and location.  Both planning and housing policy adjustments are needed to stimulate medium density development in appropriate locations, especially for affordable housing.  In addition, the Affordable Housing SEPP should be replaced with a suite of tailored policies specifically formulated to address the multiple shortfalls in this well-intentioned, but poorly implemented, policy.

Objective 4: Historically rising levels of housing affordability stress are reversed

This objective flows from the case made above. It could be addressed partly through a greatly expanded program of new social and affordable housing provision. It is accepted that this could probably be actioned only with Commonwealth Government support. The same would be true for other policy adjustments that could assist in addressing this objective: namely property tax reforms and uprating of social security benefits, especially Rent Assistance. At the same time, as discussed below, a state government has significant powers and resources at its disposal that can and should be deployed to this end, such as routinely providing discounted public land for social and affordable housing development to permit much greater supply levels than hitherto generated.

Objective 5: The interests of landlords and tenants are appropriately balanced

Australia’s private rental sector continues to expand. More people are renting their home from a private landlord than at any time in the past 70 years and more of them are remaining in this housing situation for longer than ever before. In law, however, the balance between landlord and tenant interests has remained fundamentally unchanged for decades, a status quo described by highly respected Professor Terry Burke as ‘heavily weighted in favour of landlords and against the interests of tenants’. We believe that the recent statutory review of the NSW Residential Tenancies Act missed a significant opportunity to improve tenants rights, and that it should be revisited as a priority under the Housing Strategy.

Policy levers available

Lever 1: Tax settings

Wielding tax powers held at this level of government it is open to state/territory authorities to follow a reform path widely advocated by economists, whereby property taxes are re-configured to discourage speculation and enhance owner occupier mobility – where such a move would be to their advantage – e.g. in terms of work opportunities or work travel times, or up- or downsizing.

Lever 2: Regulation

State governments enjoy important regulatory powers with a bearing on housing – in particular, land-use planning measures governing development, and legal powers framing relations between landlords and tenants. In relation to planning, it is open to states to use approval procedures to mandate private developer production of social or affordable rental housing. Likewise, regarding the regulation of landlord-tenant relations, state governments have substantial freedom to adjust tenant rights and landlord obligations in line with changing housing systems and public expectations.

Lever 3: Expenditure and other use of resources

Even without committing significant amounts of taxpayer-funded expenditure, a state government like NSW has substantial scope to deploy resources in the interests of housing strategy objectives. Most importantly, as owner of the public housing portfolio it has asset management options that could help fulfil desirable policy objectives. For example, through additional public housing property transfers it could facilitate leveraging of privately funded investment in the social housing stock. Moreover, in relation to surplus land disposals outside of the public housing estate context, it could choose to comply with stakeholder calls to impose on acquiring developers a standard expectation that a minimum 30% of resulting residential development is reserved for social/affordable housing.

Using land ownership powers to enable forms of ‘affordable home ownership’, there could be a commitment to government-seeded initiatives such as Community Land Trusts, shared home ownership schemes, rent-to-buy options and equity cooperatives.

Strategy governance

The NSW housing system is complex and shaped by multiple policy levers, both those that are housing system-specific and by broader economic, fiscal, social and environmental policy settings. This raises crucial questions on how the proposed strategy will be governed and how ‘shared responsibility’ will be realised. In our view this will call for a range of institutional reforms, especially:

  • Raising the seniority of the Ministerial housing portfolio
  • Releasing an annual Housing Budget that identifies all the government’s outlays and their intended outcomes in terms of meeting given goals for supply and affordability of housing  
  • Creating an enduring high-level State Housing Council (or similar)
  • Proactive development of a NSW Government position on future national housing policy.

Healthy built environments: reinforcing the critical role of local planning in times of challenge

Posted by on June 10th, 2020 · Pandemic, Planning, Wellbeing

By Susan Thompson, City Futures Research Centre. This article originally appeared in New Planner – the journal of the New South Wales planning profession – published by the Planning Institute of Australia. For more information, please visit:

2020 had barely begun and Australia was in the midst of the worst bushfire season in living memory. Searing heat across the nation resulted in the tragic loss of human life, livestock, native animals and properties – homes, businesses, farms and bushland. Not only devastating for the directly affected communities and the Australian economy at large, but a wake-up call about the impacts of climate change on our health. And just as the fires were extinguished, another health crisis emerged. 

The Coronavirus has engulfed the globe in an unprecedented challenge to our collective wellbeing, as well as our very way of life. At this time there might be some critics declaring that communicable diseases have caught advocates for healthy built environments unawares and scrambling for relevance. However, the current situation does not diminish in any way our need to pursue healthy built environments – in fact, what we are facing merely reinforces the importance of a health supportive environment for everyone. Indeed, for planners the present focus on human health is a reminder of the very origins of our profession and one of its central pillars – to improve health and wellbeing.

The principles of healthy built environments remain core to our health and wellbeing, as do the ways we create health supportive environments to make it easy to be physically active, socially connected, and to have access to fresh, nutritious foods. These are the most important behaviours that we can undertake each day to keep healthy and well. Not only do these actions reduce the major risk factors for chronic disease (obesity, lack of physical activity and social isolation), they assist in strengthening immunity. A recent post in ‘The Conversation’ highlighted the importance of being active in relation to supporting a resilient immune system.

A Focus on Local Space and Place

In an effort to halt the spread of the highly contagious COVID-19 virus, governments across the world have restricted the movement of people around towns, cities and regions, as well as between countries. Most of the population is spending considerable time confined to their local area – including homes and neighbourhoods. The result is that these spaces have never been more important and quite possibly, never better appreciated. This presents an unparalleled opportunity for those of us who plan, deliver and maintain local environments.

Most importantly, community engagement with the immediate and easily accessible neighbourhood reinforces the critical role that planning plays in delivering quality local environments. In NSW, the process of preparing Local Strategic Planning Statements (LSPS) underpins this function. In setting out the purpose of these visionary Statements, the Government’s ‘Guideline for Councils’ emphasises the local realm in relation to land use, identity, character, community values and responsiveness to change.

Ann Forsyth, Professor in Urban Planning and Design at Harvard University, recently reflected on the impact of COVID-19 on urban life and the part that planning needs to play in a pandemic. Much of her discussion focuses on the vital role of local environments in supporting working and studying at home, exercising nearby and shopping in the neighbourhood. Nevertheless, this comes with associated challenges, especially for those experiencing economic stress. Job losses will no doubt undermine security of tenure, which in turn poses a raft of threats to both physical and mental health. Secure, well maintained and appropriate housing is fundamental to good health and will be an ongoing challenge as we navigate life post COVID-19.

In an Australian urban context, Dr Sarah Barns, ‘city thinker and media innovator’ talks about the changes in urban rhythm (such as quiet streets, low traffic volumes, reduced commutes) as a result of COVID-19. She asks what might this mean for the future of urban spaces and places? Will planning and design need to shift its approach to urban density? Will the contribution that cities make to the modern economy be unravelled? Urbanist and cultural theorist, Professor Richard Florida thinks not. He acknowledges that cities and density pose vulnerabilities for highly contagious diseases, but they also hold the necessary infrastructure to fight the contagion. Throughout history cities have nurtured cultural innovation and improvements in health. Today, existing spatial and socio-economic inequalities are exacerbated by the pandemic – not as a result – and we should caution against a knee-jerk rejection of the urban.

Reflecting on the implications of the pandemic for planning, Mike Day, director of planning and design firm RobertsDay, notes that ‘the most resilient communities are walkable neighbourhoods’. Mike sums up the future possibilities in a way that reinforces core principles of health supportive built environments: the creation of ‘local, compact, pedestrian-friendly and connected’ places. Moving cars off the roads to give people more space to physically distance as they keep active by walking and cycling is also a critical topic of discussion and advocacy – during and after the pandemic. 

A Focus on Local Social Connection

Local places and spaces are where we socially connect with each other. Feelings of belonging and attachment are central to human health and wellbeing. It is unfortunate that the term ‘social distancing’ has been widely adopted during the COVID-19 outbreak. A more apt descriptor is ‘physical distancing’ – the requirement to keep apart from each other in space. While this is necessary to reduce the risk of passing on the virus, we desperately need to be socially close. This is true for everyone, but especially so for vulnerable groups including older people, single person households, those with disabilities and families with young children. The impact of the pandemic response has unleashed creative ways of socially connecting while physically distancing – driveway dinners and teddy bear hunts! Showing kindness to each other as we share our anxiety in the face of the unknown has never been more important. 

A Focus on Local Environments

The ways in which we can keep healthy and well during the pandemic provides a timely reminder of the critical importance of the environment – not just for humans, but for all life. Nothing has changed here – the crises of 2020 (both the bushfires and COVID-19) have merely reinforced the need for planners to protect the environment and foster social equity.

The provision of green space is one part of the environmental protection picture. Planners fully understand that easy access to quality parks is essential for good mental and physical health. As urban communities have navigated daily restrictions, they have benefited from the presence of swathes of green space that have escaped development. These areas offer much needed respite for everyone, especially apartment dwellers. The NSW Premier’s Priorities afford planners further opportunities to prioritise the provision and enhancement of green open space and the planting of trees. Plentiful green space and extensive tree canopy have never been more important.

A Final Note

While the different challenges facing all of us as we move through 2020 are extensive, they present a raft of positive opportunities for planning. This is especially so for those working at the local level – setting strategic visions and then delivering the resultant physical, social and environmental outcomes. Let’s use the renewed interest in local environments and culture to engage communities in the planning of their neighbourhoods in new and creative ways – now and into the post COVID-19 future. 

Why the COVID Commission must back social housing stimulus

Posted by on June 3rd, 2020 · Affordable housing, Climate change, Construction, Economy, Government, Housing supply, Infrastructure, Pandemic, Social housing, Sustainability

By Hal Pawson, City Futures Research Centre.

The Prime Minister’s COVID Commission is supposed to be advising government on how to ‘facilitate the fastest possible recovery of lives and livelihoods’ after the pandemic. Yet it’s main focus appears to be the promotion of a fossil-fuelled medium-term industrial strategy tailored to mining interests. Advocacy for a social housing stimulus investment program would be a far more suitable way for the Commission to fulfil its proper purpose.

The recently announced not-for-profit working group under the National COVID Co-ordination Commission could signal a belated government recognition that the NCCC has been attracting far too much critical attention as an unaccountable, dirty industry booster squad. But whether the new NFP delegates will be able to steer the Commission back towards what many would see as its proper role remains in question.

Established by Scott Morrison back in March under mining executive, Nev Power, the Commission has emerged as a rather shadowy, yet at the same time highly influential creature of the crisis. Its official role, finally clarified under terms of reference published last month, is to advise government on ‘actions to anticipate and mitigate the economic and social impacts of the global COVID-19 pandemic’. Beyond this, its job is to ‘facilitate the fastest possible recovery of lives and livelihoods’.

As Ebony Bennett writes in the Canberra Times, there’s currently a dearth of evidence that the NCCC is meeting either of these objectives. For starters, it might be expected that the Commission would be prioritising rapid-impact measures that could help cushion the economy from the deep recession already unfolding. While recorded unemployment only edged up to 6.2% in April, Australia’s true level of joblessness is estimated as close on double this figure – an ugly reality that will be starkly revealed as Jobkeeper protection is wound back.

Yet, from what little is known of its deliberations, the Commission’s main focus of interest is effectively a medium-term economic development strategy that privileges fossil-fuel powered manufacturing. As many have noted with concern, this may be of little surprise considering the mining and gas-industry backgrounds of key NCCC members. But quite apart from its inconsistency with Australia’s Paris Climate Agreement obligations, this priority hardly seems to square with the current need for emergency action to create jobs with both social and economic payoff.

On that score, the Treasurer is surely more on message in his recent acknowledgement of housing construction and tourism as sectors especially in need of urgent support. After all, construction – a large economic sector employing 9% of all workers – has already contracted by twice the rate of the economy as a whole. And, as Frydenberg also admits, heavy job losses in housebuilding are in prospect from mid-year as current projects complete, with little in the way of new orders following on to soak up industry capacity.

Comments like these seem more consistent with the understanding that stepped-up public infrastructure investment will form a key part of the Commonwealth’s crisis recovery strategy. As to what might constitute ‘infrastructure’ in this context, we should hope that Frydenberg’s prioritisation of housing will prevail over the limited vision of ‘more roads fixed and bridges built’ as voiced by the Prime Minister.

Rather than the gas pipeline network that seems the nearest the NCCC gets to advocacy for urgent infrastructure, a social housing focus within a broader recovery program would make sense for many reasons. As recently argued in P&I, targeting stimulus in this way would combine economic value-add through rapid job creation with longer term social and economic benefits, through reducing inequality, countering climate change, and meeting community needs.

A coalition of welfare and housing industry groups is advocating for SHARP (social housing acceleration and renovation program), a 3-year push to construct 30,000 social rental units across the country. That would begin to redress the 25 years of disinvestment which have seen Australia’s provision of public and community housing dwindle to under 5% of the national stock. New modelling suggests that, at a public cost of $7.2 billion, SHARP would support 21,000-24,500 FTE jobs at its peak in 2021-22, when the economy is likely to be at its weakest. As noted in the modelling report ‘this …would represent up to 30,000 workers whose jobs would be saved by the SHARP stimulus’.

Re-starting social housing investment can be easily justified as a social priority in a country where homelessness rose by 30% in the decade to 2016, and where the private market has proved increasingly unable to generate affordable rentals. Since 2001, the national deficit of private tenancies affordable to low income earners has quadrupled to over 200,000. As a result, even before the current crisis more and more private tenants had been doing it tough: eking out an existence where keeping up with the rent comes at the expense of basic essentials like food and clothing. As noted by the Productivity Commission, by 2019, this was the situation for more than half of all low income tenants – substantially a result of growing social housing scarcity.

But the arguments for governments to re-engage more actively with housing are not only social, but also economic. For one thing, there is demonstrable evidence that investing in social housing to combat street homelessness is justifiable in simple ‘cost to government’ terms. The typical annual impost on health, justice and other budgets linked to a chronic rough sleeper exceeds the unit cost of providing that same person with supportive social housing.

More broadly, there’s growing recognition of an economic productivity case for social and affordable housing investment. By expanding public and community housing, this could help reverse the expanding number of families forced to rely on insecure private rental housing where resulting frequent moves typically damage children’s educational performance. Moreover, restricted consumption of other goods and services due to excessive housing cost burdens is economically damaging.

Given the Treasurer’s hints that housing construction may be a focus of a recovery stimulus package, it’s important that these social and economic arguments are weighed in the balance against the political lure of claims for a home ownership-targeted scheme. Development industry voices call for a mass new home purchase incentive program offering $50,000 grants to induce otherwise reluctant home buyers into the market.

It’s debatable how far such programs really enable additional home sales (rather than, for example, accelerating already-planned acquisitions, or enabling an intending purchaser to buy a larger property). On a point of principle, any assistance of this kind should target first home buyers on low to moderate incomes. Better still, it should be offered as a public equity share in the purchased property, rather than being a free ‘no strings attached’ gift.

Perhaps, as under the Rudd Government’s post-GFC stimulus, a home buyer subsidy program could run forward in parallel with the SHARP. However, as a stratagem to stimulate housing demand, a homebuyer grants scheme is predicated on potential purchasers having enough confidence to step forward in response. Most will still need to take on a big mortgage. With many forecasts warning of hefty house price reductionsover the next two years, there must be some doubt that possible takers will necessarily leap forward en masse. By contrast, referring back to the smooth delivery of its pre-cursor program in 2009-11, the SHARP model is a bankable immediate jobs-booster.

Whether continuing to focus attention towards medium-term economic productivity objectives, or re-engaging with its duty to advise on the ‘fastest possible economic recovery of lives and livelihoods’, the NCCC needs to recognise the priority that should be attached to government housing investment. Indeed, in line with its mandates it should be championing this.

Homelessness policy: summary of CFRC submission to Senate Inquiry

Posted by on June 1st, 2020 · Government, Social housing

By Hal Pawson, City Futures Research Centre

In Australia and in other countries, the COVID-19 pandemic has prompted extraordinary housing policy innovation and emergency spending. Since March an estimated 5,000 people have been rescued into temporary shelter across Australia. Alongside this, panicked by the vision of abrupt mass unemployment triggering a national rent arrears crisis, state governments across the country have rapidly enacted evictions moratoria.

In the City Futures Research Centre submission to the Australian Senate Inquiry into Homelessness, we reflect on the dramatic policy developments of recent weeks and on the way that the COVID crisis has exposed the seriousness of problems ordinarily given little priority by governments in this country. We also discuss the ways that homelessness is measured and managed in Australia, as well as the need for far-reaching reform to address it in any serious way.

Efforts to tackle the problem

Even in the immediate run-up to the COVID crisis, it’s fair to acknowledge that some states were already embarked on stepped-up action to reduce street homelessness. New South Wales pledged in 2019 to halve rough sleeping by 2025 and formally signed up to the Institute for Global Homelessness model as a means to do so. The Government of South Australia is also on board as one of the IGH Vanguard Cities homelessness reduction group. These are no substitute for the abandoned national commitment to halve homelessness, more broadly, in little more than a decade as pledged by the Rudd Government in 2008. But even more narrowly-defined ambitions espoused by individual states indicate new and welcome policy prioritisation.

The past few years have also seen growing Australian interest in new street homelessness management concepts including Housing First. But the intensifying shortage of affordable rental housing seriously compromises the potential efficacy of this approach. A recent paper reviewing Australian HF projects concluded that: ‘…in all the programmes examined, the aim of providing immediate housing was undermined by lack of quick access to affordable housing, with some unable to access even temporary accommodation’.

The immediate rehousing challenge

Now in early June 2020, we have a situation where there are thousands of people temporarily rescued from street sleeping and homelessness shelters, safely housed in hotels and motels for the time being, but with no clear exit strategy for the point when funding runs dry. Although no overarching commitments have been made, it is very hard to envisage governments overseeing a mass return to the streets.

It might be expected that social housing could take the strain of providing move-on housing, but this is a sector that has shrunk from 6% to a meagre 4% of all occupied dwellings over the past 25 years. More importantly, relative to population, the number of properties let by public housing agencies and not-for-profit community housing providers has halved over this time.

In most jurisdictions the sector therefore lacks the capacity to offer long-term housing to all the rough sleepers and others currently in hotels – assuming that such a rehousing program will need to be enacted within a short timeframe. And although there is a growing clamour for a major social housing investment stimulus program to kickstart economic recovery, the Federal Government has not yet indicated any support for such a plan. Even if approved, such an initiative would offer no quick solution to a near-immediate hotel move-on housing challenge. Some are arguing for this to be addressed through a rapid spot-acquisition program, but a large-scale head-leasing of privately owned properties seems a more realistic option.

New risks ahead

Until now, there also seems to have been little recognition that we may well face a new wave of homelessness in coming months as severe economic recession pushes tens of thousands of vulnerable renters – and even home owners – into housing crisis.

Even now, while the Jobkeeper program remains in place, and jobless people are receiving temporarily boosted dole payments, these programs exclude millions of non-permanent citizens and casual workers. Many among these excluded groups are surely even now being pushed towards a hazardous housing position by sudden loss of income in shut-down sectors like hospitality and tourism. When, later this year, crisis income support measures are ended, and with them, short term evictions moratoriums, there must be a huge risk that a fresh homelessness spike will present Australian governments with a new policy challenge.

The hope must be that the pandemic housing crisis acts as a wake-up call for governments that have until now resolutely resisted the case that rising homelessness is a symptom of much more fundamental flaws in the operation of our housing system. This needs to include a recognition that a more pro-active role for government in that system is essential not just as an emergency response, but as a long-term commitment.

The City Futures submission to the Australian Senate Inquiry into Homelessness is available here:

Quality of life in high-density apartments varies. Here are 6 ways to improve it

Posted by on May 29th, 2020 · Cities, Guest appearance, Housing, Housing conditions, Planning, Public space, Strata, urban renewal, Wellbeing
Gethin Davison, Author provided

By Hazel Easthope, UNSW; Laura Crommelin, UNSW; Laurence Troy, University of Sydney, and Megan Nethercote, RMIT University. This article is republished from The Conversation under a Creative Commons license. Read the original article.

We’re building a lot of apartments in Australia. High-density precincts are being developed across our major cities. But these buildings and neighbourhoods are often not designed and managed in ways that meet the needs of lower-income residents.

Our research released today identifies five key problem areas. We also propose a broad range of solutions, including six outlined in this article. Some are easy to apply and others will require more effort and funding.

Business as usual, however, will result in increasing social and economic costs. This is because the proportion of Australians living in apartments, now one in ten, continues to increase. In recent years, we’ve been building bigger apartment complexes and creating more high-density precincts (buildings of four storeys or more).

Apartments house a broad cross-section of the population. However, they are more likely than other dwelling types to house people on lower incomes, especially in Sydney and Melbourne. Over 70% of Australia’s high-density dwellings are in these two cities.

Income distribution of households in high-density (HD) dwellings (4+ storeys) and in all other dwelling types (OD). Data from ABS Census 2016

Lower-income households have less choice about their living situation. This means they’re particularly affected if their building or neighbourhood is poorly designed or managed. It’s especially important, then, for our planning and development processes to consider their needs.

So how can we make sure the apartments and neighbourhoods we’re building meet the needs of lower-income households (the bottom 40% of incomes)?

What are the problem areas?

Our research investigates this issue. It included case studies across four high-density neighbourhoods in Sydney and Melbourne.

These four neighbourhoods house lower-income residents with varying degrees of success. We found notable differences between the outcomes of urban redevelopment that was co-ordinated and redevelopment that was ad hoc.

Residents of Upper Strathfield in Sydney were living next to an empty development site, without the street upgrades or park they’d been told was coming. The development had been delayed, which also delayed the contributions needed to provide this infrastructure. One grandmother we spoke with walks past the site with her grandchildren to catch a train to go to a park in another suburb.

Still waiting for the promised park: the vacant lot in Upper Strathfield. Gethin Davison, Author provided

In the same local government area, Rhodes West has fantastic local parks and a multipurpose community centre. It was designed with community input and funded through negotiated developer contributions.

These neighbourhoods provide a notably different quality of life, even though lower-income residents live in both precincts and both are in the same local government area. This highlights why improved policy responses, applied consistently across cities, are needed.

We identified five main points of tension in delivering high-density buildings and precincts that meet the needs of lower-income residents. These were:

  • competing incentives between the development and operational phases of a new development, including poor development decisions affecting building operations (such as unnecessarily inflating maintenance costs)
  • concerns over the boundaries between private buildings and the public domain, including unclear divisions of responsibilities for maintenance between private and public entities, challenges associated with privately owned public spaces, and a lack of street life when street-level shops remain empty
  • challenges in aligning infrastructure needs and delivery, such as ensuring developer contributions are used effectively to fund the local infrastructure that is actually needed
  • tensions between the roles of local and state government
  • difficulties meeting the needs of both current and future residents. In our Melbourne case studies in North and South Carlton, for example, gentrification created new challenges, such as some residents having to travel outside the area to get affordable groceries.

What are the solutions?

Our AHURI report, Improving Outcomes for Apartment Residents and Neighbourhoods, proposes priorities for policy and practice to help resolve these tensions and guide future high-density development.

Implementing these recommendations will require strong co-ordination by government agencies in partnership with private developers. Ensuring developments are both publicly beneficial and privately profitable is challenging for planning authorities.

More funding for public infrastructure is essential. Lower-income residents rely greatly on services and facilities like community centres, libraries and parks.

Having a park nearby will greatly improve the quality of life for residents of these apartments in Melbourne. Shuang Li/Shutterstock

Relying on development contributions to provide these facilities can be risky. In some case studies we found developer contributions did fund parks and community centres. In others, stalled developments left residents with poor local services.

Some of our proposals are relatively easy to apply. Examples include:

  • giving residents clear and detailed information about their rights and responsibilities
  • focusing more on the needs of families and children in the design process
  • better co-ordinating neighbourhood services.

Others proposals will require significant effort and funding by both government and industry. Examples include:

  • building more affordable and social housing
  • hiring dedicated place managers to oversee neighbourhood redevelopments
  • redesigning how local infrastructure is funded.

We need to prioritise these changes to ensure our high-density neighbourhoods meet the needs of all residents, not just the wealthy. If we don’t, there will be social and economic costs.

Apartment living is growing fast, meaning more people will experience the pros and cons of high-density living in coming years. Failure to cater for this shift, and to reduce the inequities lower-income residents face, risks undermining the prosperity and social cohesion of our cities.

Australia can, and must, build the post-pandemic recovery with more social housing

Posted by on May 22nd, 2020 · Affordability, Affordable housing, Government, Guest appearance, Housing, Housing supply, Pandemic, Social housing, urban renewal

By Bill Randolph, City Futures Research Centre, and Wendy Hayhurst, Community Housing Industry Association. Originally published on John Menadue’s Pearls and Irritations.

The Australian Treasurer has acknowledged that boosting infrastructure spend would be a good way to kickstart our country’s recovery from the current pandemic.

What follows is a reasoned case for that infrastructure spend to include substantial government investment in additional and refurbished social housing. Not only would that meet a pressing social need but it would also provide a substantial boost to employment in the vitally important construction industry and related sectors.

With Australia’s economy taking a record-breaking pandemic hit, governments now face the huge challenge of reviving employment as the health crisis subsides. Treasurer, Josh Frydenberg, has been clear that infrastructure expenditure would drive the recovery and a stimulus spending program should be a central plank of the recovery plan.

Construction is an obvious stimulus target because it normally employs 10% of Australian workers. We’ve just recently learned that employment and new orders have fallen to all-time lows because of the pandemic.

Ramping up infrastructure spend would help make inroads into Australia’s long-term investment deficit in this area. But it’s vital that this extends beyond ‘more roads fixed and bridges built’, as recently advocated by the Prime Minister, to include building social housing infrastructure. Stimulus investment projects like building social housing would combine economic value-add through rapid job creation with longer term social and economic benefits, through reducing inequality, countering climate change, and meeting community needs.

The Social Housing Acceleration and Renovation Program (SHARP), proposed to government this week by a coalition of affordable housing and homelessness organisations, ticks all these boxes. SHARP estimates show that if the Commonwealth government, backed by state/territory and Council contributions (see following paragraph for details), were to invest $7.7 billion in social housing infrastructure, it could deliver 30,000 additional social housing units and renovate many thousands more existing properties to high environmental standards. This is envisaged to happen in four overlapping ‘waves’ – starting with social rental property maintenance and upgrading, leading on to large scale new housing development projects. And it can be implemented immediately.

A program like SHARP would engage multiple players in the private, not-for-profit and government sectors. Commonwealth investment would be channelled through a tender process open to registered community housing organisations (CHOs), who would use public funding to leverage additional private finance. State and territory governments would be incentivised to contribute land or other material support. House builders and maintenance contractors would construct new homes and renovate existing dwellings. For the private finance input, institutional investors would be invited to subscribe to high quality bonds issued by the National Housing Finance Investment Corporation (NHFIC).

Unlike some other forms of infrastructure investment, such as major transport projects, we know that a social housebuilding program can have immediate impact. There are planned maintenance projects ready to go at the flick of a switch, and community housing organisations (CHOs) have already identified ‘shovel ready’ new build projects. In Victoria alone, CHOs have estimated that they could start working on over 2,500 units within a year, with 1,000 in hard-hit regional areas. A solar and thermal efficiency program that includes Aboriginal owned properties is also ready to roll.

Boosting social housebuilding under the SHARP program would harness existing community housing sector expertise in developing liveable, energy efficient buildings. A good model for what is proposed is SGCH’s new Redfern project, that provides 160 social and affordable housing units with an 8-star rating under the Nationwide House Energy Rating Scheme (NatHERS). Located close to public transport, with renewable energy on site, plenty of communal space and public art to connect the development to Aboriginal heritage, that Redfern project is a taste of what could be achieved across Australia.

Building more social housing would also generate a ‘multiplier’ effect. The evidence from similar projects suggests that the jobs boost could be around 1.3 indirectly generated jobs for every directly created position, potentially creating around 20,000 new jobs – two thirds in the construction industry. The stimulus could also be used to kick start mixed tenure urban renewal initiatives, particularly in town centres and precincts where affordable homes would otherwise be left out.

Social housing led recovery presents us with a chance of beginning to redress decades of under investment in this vital sector, a history that has seen social housing provision contract by a third since the 1990s, despite soaring demand. It’s now nearly 25 years since Australia saw the effective end of a routine social housebuilding program. Had the program been maintained in line with rising need over that time, Australia’s social housing portfolio would be around 130,000 units larger than its actual current size. This highlights the magnitude of our national deficit in social rental provision, although most other yardsticks produce a larger shortfall.

Even before the pandemic hit, homelessness and rental unaffordability were running at record levels, while some 140,000 households languished on social housing waiting lists. And while private rental vacancies have burgeoned in our current crisis conditions, tens of thousands of tenants have been placed at risk of eventual eviction through redundancy and resulting inability to meet rental payments.

Meanwhile, as highlighted in the latest Anglicare rental market Rental Affordability Snapshot, tenancy affordability for low income earners remains highly stressed. Across Australia, only 22% of rentals advertised for let in late March 2020 were affordable to households on a minimum wage. Even factoring in the coronavirus supplement, the scarcity of low rent properties is such that barely any were comfortably affordable to single adults on Jobseeker payments.

The construction of 30,000 social homes as part of a pandemic recovery stimulus package won’t, on its own, provide a total fix for our ailing housing system, but it will help to put us on a healthier track. For this reason, along with the building industry and CFMEU, housing and homelessness organisations, academic experts and respected professional bodies are uniting behind a call for investment in social housing to help dig Australia out of its current predicament.

Coronavirus lays bare 5 big housing system flaws to be fixed

Posted by on May 12th, 2020 · Affordability, Affordable housing, Construction, Economy, Government, Guest appearance, Housing, Housing supply, Pandemic, Social housing, Tenancy, urban renewal

By Hal Pawson, City Futures Research Centre UNSW, and Peter Mares, Monash University. This article is republished from The Conversation under a Creative Commons license. Read the original article.

Australians had become used to walking past rough sleepers. Policymakers too, seemed unmoved by the people huddled in doorways or sheltering in parks under plastic sheets. That’s until the COVID-19 pandemic rendered rough sleepers visible, because we’ve all been told to stay home and anyone without a home presents a risk of passing on the virus.

State governments have suddenly found tens of millions of dollars to create pop-up accommodation or book rough sleepers into hotel rooms. But such short-term fixes also highlight the entrenched failings of Australia’s housing system. This crisis has laid bare five major vulnerabilities.

1. Thousands are sleeping rough

Before the pandemic, street homelessness affected about 8,000 people on any given night, as indicated by census data. But this is almost certainly an underestimate.

Recent UK research showed the number of people sleeping rough in any given year was five times as many as captured in census-type snapshots. There’s no reason to think it’s much different in Australia.

Many more people are on the fringe of rough sleeping — couch surfing, for example.

2. More than a million in rental stress

Our second housing system vulnerability is the body of people – far larger again – living in insecure and unaffordable rental housing. Even before this current crisis, housing costs had pushed around 1.3 million Australians into poverty. After paying rent they didn’t have enough money left for essentials like food and electricity.

Now many of these renters will have lost jobs or work hours. Government schemes like JobKeeper and JobSeeker will temporarily help only some — temporary migrants and many casual workers are excluded.

Measures like the moratorium on evictions are welcome (provided they prove robust). The same goes for mortgage pauses by the banks, which might help property owners avoid having to sell if tenants can’t afford the rent.

But these are only stopgap efforts.

3. A shrunken social housing sector

The third vulnerability is the shrivelled state of social housing, where rents are fixed at an affordable share of income. Relative to population, the number of properties let by public housing agencies and community housing providers has halved since 1991.

Across most of Australia, waiting lists for social housing are huge. In most jurisdictions the sector lacks the capacity to offer long-term housing to all the rough sleepers and others currently in hotels. Only through emergency unit acquisitions or head-leasing will this be possible.

4. A mountain of debt

Our fourth housing system vulnerability is housing-related debt. If the pandemic-induced downturn persists and unemployment stays high, this mountain of debt could make the recession much worse.

In the early 1990s household debt equated to about 70% of disposable household income. In March 2019, the RBA warned the debt-to-income ratio had risen to 190%. The increase was mostly due to increased borrowing to buy homes and investment properties.

Even before the pandemic, one in five mortgage holders were struggling to meet repayments. If large scale unemployment were to force mass property sales, this could compound the crash as homes flood the market.

We know from the GFC experience in the USA, Ireland, Spain and elsewhere that a sharp fall in property prices can have severe and long-lasting economic consequences that worsen inequality. In the USA, vulture landlords stepped in to buy up large numbers of distressed properties and create rental property empires. Renting from owners of this kind is not an attractive prospect.

Falling prices as the market was flooded by properties whose owners had defaulted on loans deepened the GFC impacts on the US. Shutterstock

5. An unbalanced housing system

Our housing system is vulnerable to shocks because it is unbalanced, our fifth system frailty. Residential construction depends almost entirely on private developers building for sale to individual buyers.

These buyers are highly sensitive to the outlook for property values. The resulting herd mentality magnifies booms and slumps – a particular problem when they are totally dominant in the market. A magnified downturn can bring residential construction to a grinding halt. And while quick to shed labour, construction is slow to re-employ because of risk and long project lead times.

Construction normally employs more than 1 million Australians with a range of skill levels. It generates many more jobs through the building materials supply chain as well as in real estate, property management and financial services. This helps to explain why Master Builders Australia and the building union CFMEU have united in a call to government to invest in building 30,000 social housing units as part of Australia’s post-COVID recovery.

The need for a national strategy

The housing system needs more than a one-off crisis boost. The pandemic policy jolt is an opportunity to put Australia’s housing on more stable footings through a Commonwealth-led bipartisan, long-term, national housing strategy.

A key part of this should be routine social housing construction on a scale that at least keeps pace with population growth. That’s up to 15,000 homes a year – around five times the current number. This may sound ambitious, but it’s below the levels regularly achieved between the mid-1950s and the mid-1970s.

And this doesn’t have to mean a return to the post-war approach when state authorities provided public housing. Not-for-profit community housing organisations can now take on the major new supply role.

But we do need a post-war level of ambition. Government has two immediate roles to play in linking housing to a post-pandemic recovery.

The first is to help avoid a house price crash that will deepen an economic slump. Co-ordinating action with mortgage lenders could help minimise repossessions and avoid a glut of discounted properties on the market.

Governments may also need to take on distressed projects from private developers. The New South Wales government has already flagged such action.

The second immediate role for government is to support residential construction as the motor of economic revival by investing in social housing as the central plank of a stimulus package. Government-owned sites and developer-owned landbanks can be used to kick-start activity more quickly than other major infrastructure projects. Community housing providers – especially some larger faith-based players – also have shovel-ready sites.

These should be the first steps in the national strategy, which should aim to diversify both housing supply and demand.

Alongside a greater role for community housing, this could include a build-to-rent sector commissioned by institutional investors to build market rental blocks as long-term, income-generating assets. This would benefit tenants and the economy, by smoothing the boom-bust cycle of residential construction.

As we argue in our recent books, a national housing strategy must also thoroughly overhaul national, state and territory tax settings. Many of these have greater housing policy impacts than any spending program.

Tax reform could make our housing system fairer and more efficient. It could dampen the speculation that fuels rising prices and debt, while raising the revenue we need to provide decent, affordable housing for all Australians.

Peter Mares hosts a new series, Housing the Australian Nation, on Earshot on ABC Radio National from May 30, which features an interview with Hal Pawson.

Far-reaching housing tax reform could be back on the agenda

Posted by on May 10th, 2020 · Uncategorized

By Hal Pawson, Associate Director, CFRC

The pitch to replace stamp duty with a broad-based land tax has recently seen a new surge of advocacy. Just in the past couple of weeks the Reserve Bank Governor together with state Treasurers in both NSW and Victoria have all weighed into this debate once again, arguing that such a transition is now an urgent priority.

Fundamentally, this is posed as replacing one of the ‘worst’ taxes of all, with one of the ‘best’. Out would go a mechanism that creates an economic drag by discouraging residential mobility when such moves could enhance productivity. In would come a system that, by levying a cost on holding all property, discourages damaging speculation and encourages owners to use land and housing more effectively. A phased program to achieve such change would look to emulate the process initiated in ACT back in 2012.

‘Let’s scrap stamp duty’ is an appealing case, but it can be oversold. Importantly, as previously explained on this blog, it will have no direct impact on home ownership affordability: reduced tax on house purchase will be simply capitalised into property prices.

Another concern that must be addressed in any stamp duty to land tax transition is the effect that this could have for private renters. Lubricating the trading of properties by reducing transaction costs could harm tenant security. In all Australian states and territories, landlords can at present terminate tenancies outside a fixed term in order to sell a property with vacant possession. And remarkably, Queensland has just legislated, as part of its COVID-19 emergency response, to allow landlords to end a tenancy even during a fixed term to prepare a property for sale.

Even under Victoria’s plan to outlaw no grounds evictions at any time (expected implementation later in 2020), a landlord remains free to terminate a tenancy when they wish to sell. In keeping with the stance of the UK’s Generation Rent pressure group there’s an argument that this is too permissive – and would certainly be so in a world with no property transaction tax. Arguably, landlords should be free to sell only without disrupting an existing tenancy – i.e. where the buyer is another landlord who inherits the former owner’s obligations.

More broadly, though, in common with most Australian tax and policy experts, the replacement of stamp duty with a broad-based land tax seems to me highly desirable in principle. But this is a tune that has been sung many times before. In 2017, for example, Sydney Morning Herald readers were informed that a plan for such change was being hatched by Australia’s top political leaders including then-Treasurer, Scott Morrison. As we noted at that time, this harked back to perhaps the most authoritative case for such a package, as published in the 2010 Henry Tax Review.

In 2017, just as in 2010, the reform pitch fell on stony ground. What, if anything, has changed that might result in a different outcome in 2020? First, of course, the current public health crisis is proving to be a ‘focusing event’ that could open up possibilities for substantial, lasting and overdue progressive reform. Second, since the last upsurge of interest in the stamp duty to land tax , AHURI research has placed on the table a detailed implementation plan for this project of supreme administrative and political complexity. The tax advocacy organisation, Prosper Australia, has also produced detailed package of measures for making ‘the big switch’.

Possible new impetus for progressive property tax reform must be seen as a positive spin-off from the COVID-19 emergency. The same is true of the remarkable state/territory government street homelessness rehousing programs seen in recent weeks. Equally welcome is the building crescendo of voices advocating for a large social housing investment stimulus package to boost post-crisis economic recovery in a socially beneficial way.

But none of this detracts from the case argued in our recent book that the structural and systemic flaws in Australia’s housing system can be properly addressed only through a comprehensive national policy review that firmly re-engages the Commonwealth Government as lead player in analysing and fixing the problem.

This post first appeared on the Fifth Estate. Read the original post here.