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|Initiative Title:||Affordable Housing|
|Category:||Residential Services Initiatives|
Future of Manly Hospital Site – Affordable Housing
Hardly a day goes by when the Manly Daily doesn’t have some heart breaking story about local members of our community having to move elsewhere simply because they are no longer able to afford to continue to live where they were born, went to school and grew up. Working families, caught in the grip of rising house prices and sawing rental payments, can no longer afford to live here, taking their much needed and valued skills elsewhere. The stress of it all can be felt right across our greater community, in all facets of business and public services. Most are spending any where between 30- 70% of their household income on rent. Many of these are our long term locals who we might call “Care Workers” and “Emergency Service Workers” – social workers, nurses, carers, young doctors, teachers, police, paramedics, students, etc. All people we can ill-afford to loose from our community. Many of these are the type people we are most likely to need to service our ailing health care services. Our proposed Manly Community-driven Health Care Facility (McHCF) will need many such Care Workers!
The most critical issue is the lack of supply; the supply of affordable housing.
What does this term “Affordable Housing” (primarily for Care Workers) mean?
Being able to provide a reasonable spectrum of affordable housing at our Future Manly Hospital site must surely be one of our main priorities. “Build-to-Rent” is the term often ascribed to medium-density housing held by institutional owners for renting. This type of housing is what people called “key worker housing” for people who are basically in that middle bracket who maybe can’t afford home ownership at the moment. If the value of the site land can be taken out of the cost equation, then the notion of the renting and even (non equity-based) purchases, then this must surely add to the affordability proposition for residential accommodation.
Another concept known as “inclusionary zoning” is widely employed as an effective method to ensure affordability housing in central locations like our Manly Hospital site. This approach has been proposed as part of our Greater Sydney Commission’s grand plan for Sydney city. Rezoning may be required to allow future renters/owners to pursue mixed-use development while establishing height limits in an area that includes other resident types, like aged care, disability housing, etc. and retail outlets for private health care services etc.
Affordable Housing covers a broad spectrum of accommodation opportunities that are currently not available within the Manly Community. The most basic examples of “unaffordability” is our homeless. Whereas the more fundamental form of our “unaffordability” gap pertains to our young who probably grew up within the Manly Community and through no fault of their own find that they can no longer afford to purchase or rent appropriate accommodation in the Manly area primarily because they simply cannot afford to do so. Enabling our younger generation to live and work in their local Manly area is a prime objective, especially with the rising house prices and rental accommodation making living locally an impossibility.
Those who have no/little savings, the only viable option is rental accommodation. For those with some savings and a desire to purchase their own home, most are forced to seek accommodation in a location within their financial capacity and away from their traditional comfort zones of family, friends and network of contacts. For example outback Australia towns, are advertising liveable homes for $100, because of their decreasing populations. But they tend to be lacking in employment opportunities, with their prime driver being population growth.
The two categories of home “affordability” in our major cities can be described thus:-
What is deemed to be Affordable housing in the cities (where the bulk of the homeless reside) are homes at 20% lower than average market prices for our social or key workers seeking rental accommodation at such affordable prices. The first “no-brainer” in that there needs to be an as demand far outstrips viable supply. The resultant trend is away from larger homes and blocks to smaller homes close to amenities (such as shops, parks, transport, schools and grandparents, etc). is clearly another determining factor for getting the best “banks for available bucks”, irrespective of a rental or purchase decision. To make the most of the space (home and land) flexibility of the occupants, innovation to cut costs (like solar panels), an open plan design with on-site parking (not necessarily a garage) is sought. Today homes specifically designed for low energy consumption attract government capital (from the Federal CEFC – 7 star NatHERS). This assists in building more affordable better homes but even this capital is limited. As mentioned earlier, what’s required is a product design priced well below the going rates in a particular area (like Manly), a smaller home supported by viable financial models for rental and purchase (even for investors seeking to rent at affordable prices) such as:-
To provide this style of affordable housing, a shift away from the traditional developer-pays approach is required. New home buyers in NSW currently pay 42% ($250,000) of the cost to the government in the form of taxes, levies and charges. The average time to save their minimum deposit is 5 years on an average $600,000 home. This continuance is non-viable, if we are to ever solve our housing affordability issue. The new housing sector bears a large, inefficient and inequitable tax burden, which inevitably fall on the home buyers. It’s the second largest tax contributor after the GST. Reducing this burden in part or totally could be achieved by removing stamp duty, compliance, costs, ad hoc taxes, fees, charges and the supply-side barriers. The housing sector contributes towards $40bn in tax revenue each year. Recent data shows that the removal of taxes would slash the cost of new housing in Sydney from $639,533 to $371,617, a whopping 58% reduction.
In the extreme are our homeless. The key exit strategy for homelessness is support and employment. The key drivers are rising house prices, addiction, domestic violence, government taxation and broken marriages. Homelessness is mostly circumstantial ie. not necessarily brought about directly by the people and families involved. Even a person who is currently struggling to pay the rent and wants a home of their own, could be regarded on the extremes of homelessness. People can suddenly finding themselves subjected to the previously mentioned driver situations through no fault of their own. These are personal situations which push them onto the bottom rung of the social ladder, totally unprepared for what is to follow. There is no lower social state for an otherwise healthy person than to find yourself (and/or potentially your family)
Clearly, It is impossible to make 10% of homes affordable (as suggested in the above list) by requiring the developer to carry this reduction; for these reductions will merely be passed on to the remaining 90% of conventional homes purchasers. Making conventional house prices more expensive only ever leads to putting additional pressure on the (once) affordable sector. because the gaps is eventually passed onto the 200,000, in the current boom, who are waiting to buy new homes.
Social affordable housing has to be a vital part of our current housing solution. Low-income individuals and families need quality accommodation but the government and the local community need to work together effectively to achieve this.
The lack of affordable housing to rent is the primary reason for most people being homeless in Australia. extra demand for accommodation across all major cities has been identified as the reason the homeless rates around Australia are increased. In Melbourne the rate of increase in rough sleepers is up 75% in the past 2 years. Family violence is a major contributor, especially where domestic violence campaigns lead to the removal of women and children from their home situation without a matching increase in available housing and support. Despite the Victorian government construction of 180 new units of crisis accommodation and the availability of 130 new women’s refuges, there remains 250 rough sleepers in Melbourne CBD, up from 142 in 2014. Figures in Sydney are just as bad – 28,000 people are homeless, 60,000 families are sitting on public housing waiting lists and it’s getting worse. The home affordability issue needs to be urgently addressed as refuge and crisis centres are only ever short-term measures and most are constantly full. Unless appropriate housing is found for these people, they inevitably join the “rough sleeper” category without any permanent accommodation and the unemployment queues. Homeless frustration inevitably leads to increased crime and house brake-ins. The streets are filling with more homeless than ever before. There are more women on the street than ever before. Many women (for obvious reasons) choose to live in their car if they are fortunate enough to own one. But where they choose to park becomes an issue.A common survival fall-back for the homeless is to travel on trains every day as part of their cycle of survival. Again putting a strain on our public transport system. Where the homeless leave their meagre possessions and necessarily portable belongings also become an issue as it all accumulates across the public domain. Many store their possessions in shopping baskets or large plastic carry bags.
Governments around Australia are fighting a losing battle, for no matter what initiatives are put in place, demand continue to exceed the ability to create new housing options. Possibly governments could act as mortgage insurers for lower income groups and affordable home developers by assisting in their purchases of specifically designated and approved affordable housing in an attempt to drive down low end accommodation rates and to free up even more affordable existing rental accommodation.
An excellent model to consider is that underpinning the recent “Nightingale” project in Victoria, where affordable housing is made available at around 20% beneath market price on the condition that the property’s affordability is able to be carried onto the next purchaser. In which case, the purchaser forgoes the opportunity to take advantage of the traditional growth in property equity, containing their sale to also being 20% below current market.
Suggestions abound when it comes to enabling first home buyers (FHBs) to get into the housing market:-
· FHBs delay having children to allow more time for saving deposits
· Move to a regional area where housing is more affordable
· Reduce/eliminate Stamp duty for FHB
· Encourage greater development of new housing by make capital more accessible
· Stop negative gearing for home investors
But our broken democratic process (warring political factions) is preventing much needed affordable housing legislation address regulatory issues and viable affordable housing strategies and policies from gaining any traction.
In the meantime, community empowerment through the use of technology innovations (like social media) is enabling individuals to become more powerful than ever to leave the world better than we found it.
General Housing Trends
Affordability has also brought about a significant social shift in Australia cities:- living alone. According to the ABS, one-person households in NSW are projected to rise from 630,000 in 2011 to 1.03 million by 2036. Little wonder the demand for studio and one bedroom apartments suitable for singles is far outstripping supply. At the older end of the spectrum, many of our widowed elderly are also living alone. This dilemma fs now becoming the fastest type of accommodation sought by a large proportion of our population.
People are living longer, often outliving their partner and women’s equality are contributing to both male and female feeling they no longer have to be married and through modern communications no one is truly alone any more. Our younger people feel they have better things to spend their money on and simply use their home as a place to sleep.
The latest BASIX figures suggests only 19% of new apartments are either studio or one bedroom, while 2 bedrooms account for 64% of new development and 17% for 3+ bedrooms. The older style one bedroom accommodation are in hot demand, especially by first home buyers. With these trends in mind, low-medium income earners’ demand for affordable housing is beginning to influence the style of internal design for both the re-use of existing buildings and the construction of new accommodation.
With aged care facilities likely to favour that for both singles and couples, the emphasis for new designs extends into the general needs for a range of affordable housing:-
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