With Canberra now the most expensive city to rent in Australia, Liberals MLA Mark Parton, Shadow Minister for Housing and Homelessness, proposed measures in the Legislative Assembly last week to ease housing stress.
Although community housing organisations welcomed Mr Parton’s ideas, the government was not at home to Mr Parton’s proposal. The ACT Housing Strategy was already working on similar lines, Minister for Housing and Suburban Development Yvette Berry argued.
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The ACT is the most expensive jurisdiction in Australia to rent in, and many low-income Canberrans struggle to find affordable housing.
Mr Parton believed that community housing providers (CHPs) could be the answer. He also proposed reassessing the land regime to see if supply met demand; introducing an NSW-style land tax; shared equity arrangements; a renter supplementation lease like Victoria’s; and more extensive land tax exemptions and rates rebates.
Labor and Green governments, Mr Parton claimed last week, had exacerbated and failed to address the cost of housing and skyrocketing rents; they had presided over a land release regime whose terribly constrained supply drove up housing costs.
“Thousands of people trying to get on the rental merry-go-round have discovered this crisis is affecting many people who are a fair way up the food chain,” Mr Parton said.
Ms Berry amended Mr Parton’s motion, making it a simple statement to continue the 10-year ACT Housing Strategy, under which 400 new social housing dwellings will be built and 1,000 dwellings renewed.
Ms Berry added that some of Mr Parton’s proposals – such as a shared equity model or expanding the community housing land tax exemption scheme – were already included in the Strategy.
She said the government had last year provided $2.2 million in direct rent relief to CHPs, as well as engaging community organisations to provide emergency accommodation and permanent housing for rough sleepers.
But Mr Parton said Ms Berry’s amendment was more of the same.
“More rental stress, more homelessness, more pain, for those who simply cannot get a firm foothold in the tightest and most expensive rental market in the country,” he said.
Despite the government’s commitment to support housing affordability, Mr Parton claimed he had not seen any improvement. “Where is the action? The height of the crisis is now; I’m not seeing it.”
Mr Parton objected to a fundamental change in the first clause. Mr Parton’s original proposal began: “The ACT is Australia’s most expensive rental market. As a result, an increasing number of residents are experiencing housing stress.”
Ms Berry’s amendment read: “While the ACT is one of Australia’s most affordable jurisdictions to rent and buy a home on measures based on average incomes, these higher-than-average incomes hide the challenges lower-income families face in the private rental market.”
Mr Parton said he was astonished the Greens would accept that amendment. Their website notes that Canberra has the highest rental prices in the country, and many Canberrans cannot afford to buy or rent a home.
Support from housing organisations
Nevertheless, Mr Parton’s proposals garnered some support from community service organisations.
ACT Shelter CEO Travis Gilbert supported many of Mr Parton’s proposals. He urged the government to investigate the effectiveness of policy levers; extend lease durations for public housing let out by Housing ACT to community housing providers; and reassess the land release regime to determine if supply was meeting demand.
Mr Gilbert believes the ACT Government is missing out on Commonwealth money; adopting the Liberals’ proposals to partner with CHPs would offer them critical access to Commonwealth dollars for social and affordable housing (via direct cash payments for rent assistance on the demand-side, and low-cost debt-leverage on the supply-side via the Affordable Housing Bond Aggregator).
The Commonwealth contribution to public housing had fallen by more than 60% in real terms since the ACT was granted self-government in 1989, while the ACT Government itself has rationed standard allocations to households earning less than $36,000 to ease demand pressures.
“Not only is there not enough [housing], if you are earning more than 700 bucks a week, you’re ineligible,” Mr Gilbert said. “That’s a big problem in a private rental market asking $637 a week for a three-beddy in the ‘burbs. With no savings capacity, an event as common as needing major repairs you can’t afford – to the car that gets you to the job that pays your rent – can be the catalyst for the descent into homelessness.”
Mr Gilbert agreed that CHPs could be the answer. They embedded both social rental housing (30% of income) and affordable rentals, let at just below 75% of market rent into their business models. For working parents needing detached homes with bedrooms for their kids but priced out of both social housing and the private rental market, that 25% would add $160 a week to the household budgets of parents kept awake by cost-of-living pressures.
“The difference that would make to their lives cannot be overstated,” he said. “ACT Shelter urges all parties to think of those families, and work across the Assembly to increase housing options for them, including adopting measures in the housing affordability motion tabled by Shadow Minister Parton that meet mutually desirable objectives.”
ACTCOSS acting CEO Craig Wallace welcomed Mr Parton’s efforts to put the affordable housing crisis on the Legislative Assembly’s agenda, and agreed a multipronged approach was needed.
ACTCOSS’s starting point would be land transfers to CHPs, he said, while the mix of tax and other proposals Mr Parton had put forward would need more consideration.
Mr Wallace said that 15% of government land should be released for public, community and affordable housing in infill development and new suburbs; ACT CHPs must be empowered to build more community and affordable housing; land transfers to them increased; and land development, planning and zoning must be reformed.
Community Housing Canberra Ltd chief executive Andrew Hannan welcomed the discussion and debate on practical and cost-effective measures to address the rental affordability crisis, including those measures raised by the Canberra Liberals.
Mr Hannan said it was critical the government provided the extra 600 affordable rental dwellings promised in the Parliamentary and Governing Agreement by 2025–26.
“Whilst small compared to the current shortfall of over 3,000 dwellings, it would reflect a significant uptick in the growth rate of affordable rentals within the ACT in recent years,” he said.