b'JULY 2020Developing Government owned land Establishing a strong and sustainable mechanism for The NSW Government has dipped its toes in theinstitutional involvement with affordable housing in water and created housing estates of mixed social,an important new approach in the right direction.affordable and market priced homes on governmentSuperannuation funds have money invested in land at Washington Park, Riverwood and thehighly secure, low interest bonds as part of their Communities Plus program projects at Ivanhoe,balanced growth funds. This housing bond Waterloo, Telopea and some regional locations. aggregator funding model delivers a AAA credit A Communities Plus style program has enormousrating backed return to the funds as well as potential to renew dilapidated, run down socialproviding homes for key workers and often for housing estates and projects, in well located, existingsuperannuation fund members.urban areas with similar mixed tenure estates.Unlock tired, old, obsolete and underutilised Bulldoze the old estate and re-develop with height!industrial landA new Approach to funding affordable housing Traditional industrial land in inner and middle ring Urban Taskforce welcomes the Commonwealthsareas of south and south west Sydney have been successful launch of Australias largest evereffectively quarantined from renewal for housing. special government bond issuance for social andThere are a number of examples of eye-sore affordable housing totalling $562 million. This isdilapidated old industrial estates which have the smart and fair way to raise money for social orlong since been abandoned and left as empty affordable housing.warehouses. The Government could offer incentives The Commonwealth uses its AAA credit rating toto promote inclusionary based redevelopment underwrite borrowing, then makes that moneyprojects that include a substantial affordable available to the community housing sector. Thishousing component on these sites. results in significant savings compared to the freeThe key to achieving a return for government is to market-rates which cost developers 1015% perthink big. The greater the height, the better the annum for a combination (depending on the mix)return in terms of quality of amenity for the of debt and equity funding for new householdnew market priced and affordable homes and construction and development.apartments in the project.These savings support the construction of social andWhere the government owns land, a full suite of affordable housing which are then managed byhousing options can be developed including community housing providers. market priced housing, affordable housing and This type of scheme is popular in the UK and in Northsocial housing.America and encourages institutional investment inThe first step to making housing affordable is long-term housing stock.through the planning system, particularly by DPIE, This innovative funding mechanism is significantlyCouncils and decision makers working together to more sophisticated and productive than moredeliver more approvals and faster rezonings.simplistic models that are applied by manyWe need 50,000 new homes in greater Sydney Australian councils to fund affordable housingjust to stand still let along bring supply side finance, like those condemned above.pressure to lower housing prices. The affordable Under traditional developer contribution models,Housing sector deserves more than a paradoxical new apartment and home buyers pay for atax on new home buyers.problem that government has created when itA combination of the Commonwealths new funding wound back its traditional investment in socialmodel, inclusionary planning, offering development housing, and allowed planning for housing andincentives and developing government land, must be development approvals for housing to becomeapplied to ensure that social and affordable housing slow and cumbersome. These factors have drivenis also delivered.UrbanIdeasup prices by constraining the supply of new homes. Affordable contributions are not only regressive, but also create intergenerational inequity. 18'