5 September 2022

Government looks for ways to boost community housing as it closes door on CHC model

| Ian Bushnell
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CHC housing

CHC will still manage the 105 homes now in government hands along with its other tenancies. Photo: CHC.

The ACT Government is again looking for ways to boost the supply of affordable rental housing after drawing a curtain across its former arrangement with CHC Australia.

Tender documents show Treasury ACT is seeking a consultant to explore how the government can increase affordable rental housing for low-to-moderate income households, particularly through community housing providers who generally charge no more than 75 per cent of market rent.

They say the ACT has a small community housing market compared to other jurisdictions and Treasury wants to know what policy options could help to grow the sector.

The tender comes as the government takes into public ownership 105 properties worth $62 million that CHC bought with government loans in a program that started in 2008.

READ ALSO Government rejects analysis that land supply, land tax behind high housing and rental costs

The government provided ongoing financing of $50 million and guaranteed CHC access to 120 units of land a year to deliver housing priced at 25 per cent below the market rate.

But it eventually wound back assistance and land supply, especially for standalone houses. Then, in 2018, rather than rolling over the initial loan and financing, the government called the loan in, forcing CHC to begin paying back the principal at $2.5 million a year, a decision that attracted widespread criticism at the time.

Now at what the government says is CHC’s request, those properties are in government hands and CHC’s debt has been discharged.

But CHC will still manage the properties for the government for an undisclosed fee, but they won’t be counted as public housing stock.

“This arrangement will put CHC in a stronger position financially and enable them to grow their affordable rental housing stock, which will also assist with the Parliamentary and Governing Agreement for the 10th Legislative Assembly (PAGA) commitment to an additional 600 affordable rental properties,” a government spokesperson said.

CHC expected to grow its affordable rental portfolio by about 100 properties over the next several years.

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The spokesperson said that under the previous model, the housing assets were encumbered, making it harder for CHC to borrow to grow its stock.

“This restructure will assist CHC to remain an ongoing and financially viable organisation and help to grow the number of affordable rentals in the ACT.”

CHC would also be able to apply for funding from the National Housing Finance and Investment Corporation (NHFIC).

The new push to boost community housing comes as the ACT’s lower-paid workers, many in key service areas, are locked out of the sky-high housing market and struggle to find a place to rent in an environment of extremely low vacancy rates and steepling rents.

The consultant will have to do a stocktake of community housing in the ACT and identify areas of greatest need.

It will look at existing policies in other Australian jurisdictions and overseas and how the government’s much-maligned land release approach might impact their application to the Territory.

The government also wants to know how it can attract new providers.

The consultant will assess what fallout there will be from the end of the National Rental Affordability Scheme on affordable and community housing in the ACT and explore what other Commonwealth funding might be available.

Treasury expects a final report by the end of November.

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The government already has Build-to-Rent initiatives in play, as well as exploring the potential to develop community housing on underused community-zoned land.

Fifteen per cent of annual government residential land releases already go to public, community and affordable housing.

The housing crisis has driven activists to form a new Canberra Housing Coalition to campaign for more community housing and to support low-income tenants.

Involving ACT Shelter, ACTCOSS and the Canberra Student Housing Cooperative, the new group wants to restore the Tenants Union, which lost government support in 2019 and work for changes to the Residential Tenancies Act to protect tenants from predatory landlords and outlaw rental bidding.

A meeting to elect the working committee and finalise the launch of the Coalition will take place via a hybrid face-to-face/online meeting on Thursday, 22 September.

To learn more, email canberrahousingcoalition@gmail.com.

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Incidental Tourist6:54 pm 09 Sep 22

If the government wants lower rents and more rental supply, then this government should reduce land tax on rental properties and relax tenancy legislation to attract investors back in ACT.

nope. decades of pandering to renter interests has resulted in more expensive housing.

The original model chosen by the chief whiner Stanhope for CHC was a joke – it was never going to stack

CHC undisclosed fee Ratepayers Money! not another RED TRAM?

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