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The federal government’s Housing Accord, which promises to build 1 million “well-located” homes by the end of the decade, will only deliver 184 affordable homes, new analysis from the parliamentary library shows. The analysis, which was commissioned by the Greens, used market rents from data analysis company Corelogic and measured affordability by comparing wages data from the Australian Bureau of Statistics with the broadly accepted “30:40” definition of affordability, which suggests that if you are among the lowest 40 percent of income earners, you shouldn’t be spending more than 30 percent of your income on rent.
The results, based on the assumption that the homes built would be located in metropolitan areas and are distributed in line with current trends, shows that all of the affordable homes built under the accord would be located in Greater Darwin, in the Northern Territory. Greens MP and spokesperson for housing and homelessness, Max Chandler-Mather, said the analysis proves that the government’s Housing Accord is “a complete con”.“You don’t solve the housing crisis by providing incentives and tax concessions to property developers to build the same number of luxury homes they did over the last five years, you solve it by building public and community housing,” Chandler-Mather said. “When you consider the fact that the Stage 3 tax cuts and negative gearing and capital gains tax discounts will cost the federal budget $411 billion over the next 10 years, while Labor has committed just $10 billion to social housing, it’s pretty clear where Labor’s priorities actually lie.”The national housing accord was announced as part of the Albanese government’s first federal budget in late October, folding together a $350 million commitment from the federal government to fund the construction of 10,000 “affordable” homes over five years, starting in 2024, with a further 10,000 homes to be built by state and territory governments. On top of the funding, the government said the accord would force state and territory governments to speed up zoning, planning and land release—major speedbumps for new developments—to “improve the availability of social and affordable housing in well-located areas”.
The theory is that rents should ease if the government can ramp up supply, and that housing stress should ease, too. But the government wouldn’t be the ones paying for it—or, at least, not all of it. At its core, the policy offers more to the property industry than it does the households it has been pitched to. To build the remaining homes unaccounted for by the various government commitments, the federal government has set up financing options through the Housing Australia Future Fund to try and get superannuation funds and other massive institutional investors to pay for the construction of these homes. To sweeten the deal further, the government has offered them a stream of income that covers the difference between market rents and the subsidised rents they will, at least in theory, be offering to low income families. In other words: it’s a handshake agreement between the market and all levels of government to get supply moving to the tune of 200,000 homes a year, without any guarantee on the amount of private investment that will come, or if it will come at all.Treasurer Jim Chalmers hasn’t been shy about any of the uncertainty, either. Announcing the policy late last month, he said: “The Accord recognises most of this supply needs to come from the market, with government playing a key role in enabling and kick-starting investment.”
As investors gather at a roundtable to discuss bankrolling the plan later this week, the future of much-needed public, community and affordable housing hangs in the balance—and demand for it continues to skyrocket.Earlier this week, the UNSW City Futures Research Centre released new research commissioned by the Community Housing Industry Association that showed the 640,000 households that reported to be in housing stress in last year’s census is set to swell to 940,000 by 2041. According to the Australian Institute of Health and Welfare, meanwhile, the wait list for those seeking social housing grew by 8,000 households last year, up from 155,141 to 163,508, while the latest available census figures from 2016 counted more than 116,000 Australians experiencing homelessness.After the accord was announced, Chandler-Mather said the private sector had already built just under 1 million homes over the last five years, “so Labor announcing that under their plans the private sector will build [another] 1 million homes over five years from 2024 is a complete joke.”“The ‘housing accord’ looks like a complete con job. Planning deregulation and handouts to the private sector to build housing won’t fix the housing crisis, any more than any housing tax breaks or planning deregulation has in the past,” he said.“In reality, the only extra thing Labor has announced is $350 million for 10,000 so-called affordable homes over five years, all the rest is smoke and mirrors.”Follow John on Twitter.Read more from VICE Australia and subscribe to our weekly newsletter, This Week Online.