Community Housing Sector For Australia’s Housing Crisis
Housing Australia, previously the National Housing Finance and Investment Corp, released data last year showing more than 377,600 households are in need of housing, including 331,000 in rental stress and 46,500 experiencing homelessness. A consensus has developed that the key differentiator between Australia and comparable countries with less severe affordable housing problems, such as the US and Canada and certainly the UK, is the pivotal role of community housing sectors, and the participation of private capital. As part of this effort, the main game at the moment is the first funding round for 40,000 more social and affordable homes through the Housing Australia Future Fund Facility (HAFF) and National Housing Accord Facility (NHAF) over a five-year period. The HAFF is a $10bn investment fund established by the Federal Government and managed by the Future Fund, with a target of 30,000 social and affordable homes over the next five years, while Housing Australia’s mandate under the Housing Accord, also established by Canberra, is to deliver 10,000 new affordable homes over the same period. The programs have been designed to encourage participation by eligible entities for diverse projects of all sizes, enabling the community housing sector to grow and become self-sustaining. The 10-week funding round, which closes on March 22, has been pitched at states, territories, local governments, CHPs, indigenous charities focused on housing and housing-related defence charities. In February, four of the nation’s biggest industry superannuation funds and industry super-owned IFM Investors announced a landmark agreement to lend member funds to CHPs. The five entities, which collectively manage more than $505bn and also include Cbus Super, CareSuper, Hostplus and Rest, said changes to Federal Government policy settings meant there was now an opportunity to invest at scale and generate risk-adjusted returns for members, while at the same time increasing the supply of social and affordable housing. Funds from the joint venture, they said, would support applicants in the first round of the HAFF program, and provide long-term debt through an IFM-managed investment structure to CHPs. NAB, which has its own commitment to provide at least $6bn in financing for affordable and specialist housing by 2029, has been a strong supporter of Housing Australia and its initiatives, having been a foundation bank for the Home Guarantee Scheme (HGS) and financing 5127 borrowers in 2023.There is a significant pipeline of transactions where NAB will provide financing to CHPs applying for first-round HAFF funding. Housing Australia funds AHBA loans by issuing its own bonds into the wholesale market at a lower cost and for a longer term than traditional bank finance, with the Federal Government also providing a $1bn line of credit for the operation of the AHBA. There’s also the Home Guarantee Scheme, which helps eligible home buyers including first-time buyers and single parents to overcome some of the key barriers to home ownership, such as saving a deposit. Under the scheme, Housing Australia has responsibility for managing 50,000 guarantees a year, also supporting regional first home buyers who haven’t been in the property market for 10 years and helping people with a low deposit to get into home ownership or back into home ownership.
Tags : National Housing Finance and Investment Corp Housing Australia affordable home ownership states territories local governments CHPs