The importance of a safe home has been thrust into the public spotlight. As has the importance of segments of society who are leading the battle against COVID-19. Indeed throughout these difficult times the importance of key workers has been amplified. There has been an acknowledgment that society simply can’t function unless we look after people in these roles. Ensuring access to quality housing is the most important factor in achieving this.
There are also currently thousands of people living in social housing and thousands more on the waitlist as a result of rising unemployment. This is likely to grow as the moratorium on evictions expires and a second wave of social and economic problems is brought on by ongoing housing insecurity.
Historically social housing has been proven to be an important part of economic recovery. After World War II, social housing strengthened the social fabric of communities. Around Australia, hundreds of thousands of social housing dwellings were built to provide affordable options for workers to allow them to save and buy a home, as well as a safety net.
In short, social and affordable housing has never been more important. It is also growing in demand. On a national level housing underpins a strong economy and is the backbone of a functioning community. It enables people to participate in social and economic opportunities that in turn lead to better emotional, physical and financial wellbeing. Housing security cannot be allowed to remain a privilege in a post-COVID-19 world.
A seismic shift is underway that will see all housing investment opportunities opened up to institutional investors later this year. The seeds of change were sown last year when Infrastructure Australia released its 2019 audit and included social housing infrastructure for the first time. It also highlighted social and affordable housing infrastructure as a nascent but growing investment opportunity.
Historically the ownership and delivery of Australia’s housing has been a role of government, quasi-government and the private sector, depending on the type of housing. SGCH has worked with a range of partners to attract over $400 million in investment since 2014 to deliver more social and affordable housing.
But social housing has languished after years of underinvestment. For the last 40 years social housing development has been in decay and it now represents just 4.4 per cent of new housing from a post World War II high of 18 per cent. Last year’s audit offered a clear way forward for government to set policy and commit funding that can attract a pipeline of investment into community housing.
For Australia’s $3 trillion superannuation industry, the opportunities for stable long-term investment are compelling. With a large proportion of social housing rental underpinned by the Australian government and the demand for key workers showing no sign of abatement, the risk profile of this investment should prove very appealing to the funds. Investing in social and affordable housing also allows institutional investors to meet the growing pressure for responsible investment.
History shows us that with the right policy settings, community housing can offer a safety net and a springboard in the housing market. Community housing providers will be well placed to serve as a partner with government, community and the private sector to create a resilient housing system that gives everyone the security of a safe and affordable home.
Through industry networks, including the International Housing Partnership, Australia’s social and affordable housing providers are working to gather international insights and to combine this with Australian experience to inform the policy and funding settings that will embed a social and affordable housing asset class. After all, if government gets the settings right, Australian super funds and other larger institutional investors will have an opportunity to invest in this valuable social infrastructure.
Scott Langford, chief executive, SGCH