Tax reform could enable institutional investors to address Australia’s ongoing affordability crisis, according to the National Housing Finance and Investment Corporation.
The research highlighted investment barriers in low-cost housing in Australia compared to international markets, where for-profit housing providers are boosting affordable housing supply.
Property Council chief executive Mike Zorbas said private investment in the US and UK supported subsidised housing and Australia should be on par with those increased investments.
Zorbas has called for the federal parliament to grant gateway reforms, which included the Housing Australia Future Fund and the Affordability Council, to help ease the crisis.
Zorbas said the research and analysis provided more support for the government reforms to be passed by the Senate.
“Australia will fail to address the housing gap until we bring down the cost of buying and renting homes by improving our state planning systems, unlocking further supply by becoming the first choice for global capital, as partly anticipated by the national housing accord,” Zorbas said.
Almost a quarter of Australians experiencing homelessness were aged 12-24, according to Australian Bureau of Statistics data.
Of the 122,494 people who were homelessness on census night in 2021, 55.9 per cent were male and 44.1 per cent female.
“We need to level the playing field for new build-to-rent housing, purpose-built student accommodation, and retirement living communities,” Zorbas said.
To decrease homelessness in Australia, Zorbas said, long-standing government backed finance, subsidies, tax credit incentives and preferential planning treatment should be adopted.
“Australia faces a stark reality; we are not planning for, or supplying, enough homes across the housing spectrum,” he said.
NHFIC analysed investment obstacles, which included housing projects that lacked commercial returns, insufficient scale, a lack of data on vacancy risks and an overall unfavourable market.
In the UK, private capital investment in affordable housing projects has increased from 30 per cent two decades ago to about 70 per cent, or $11 billion, today.
The US market is worth almost $54 billion.
Australia’s largest superannuation funds are facing increased pressure from the federal government to boost the country’s affordable housing supply.
Article source: www.theurbandeveloper.com