Australian Government Introduces $10 Billion Fund to Address Social Housing Issues

The Australian government has introduced a $10 billion (US$6.95 billion) package to address the shortage of social and affordable housing across the country, touting it as a ‘turning point’ for homeownership in Australia. increase.

February 9th, australian government announced that it will introduce new legislation to Parliament to establish the Housing Australia Future Fund. This fund will be used to finance social housing construction.

$10 billion fund first announced by. Labor Party It’s the biggest investment in the housing sector in over a decade, ahead of the 2022 federal elections.

Housing Minister Julie Collins said in comments obtained by the AAP that “the housing problem is pervasive and visible…the dream of a safe home has become very difficult.”

“For too long these horror stories have been ignored by the Australian government. Today is the turning point.”

Legal details

The housing minister said the government expects to build about 30,000 social and affordable housing in the first five years of the fund.

It is worth noting that the fund will live in perpetuity and the government will use its proceeds to invest in housing across Australia.

However, the amount that can be withdrawn from the fund is limited to $500 million per year.

“This fund will be the end of the housing fad from the Australian government,” Collins said.

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Australia’s Housing Minister Julie Collins speaks with journalists in Canberra, Australia, June 20, 2018. (Michael Masters/Getty Images)

The Act also includes the establishment of Housing Australia and the National Housing Supply and Affordability Council.

Under the new legislation, the existing National Housing Finance and Investment Corporation to Housing Australia will be renamed Housing Australia with its functions streamlined.

Independent housing bodies are tasked with ensuring that housing funds are distributed fairly and equitably to all states and territories, cities and territories.

Meanwhile, the National Housing Supply and Affordability Council will act as an advisory body providing independent advice to governments on how housing policies should be implemented without distorting the market.

“We provide independent expert advice on the appropriate policies and measures needed to address housing affordability,” Collins said.

“We want to build more homes faster, but we have to make sure they are the right homes in the right places.”

Housing industry response

Following the announcement, Mike Zorvas, CEO of the Property Council of Australia (PCA), a leading advocate for the property sector, said, with the participation of all levels of government and business, Welcomed the government’s initiative to solve the nationwide housing shortage. .

“The legislation introduced today is an important first step for the government to work with industry to fill housing shortages across the country and stimulate new supply that Australia desperately needs.” Zorbas said in a statement.

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General view of public housing towers seen from Morehead Street, Sydney, Australia, 16 September 2021. (Lisa Maree Williams/Getty Images)

The CEO also empowers the Housing and Affordability Council to enable his organization to assess the performance of the housing system and the ability of state and territory governments to meet housing demand. He said he supported the idea that

Nonetheless, Mr Zorbas pointed out that the government needs to implement further reforms to solve the housing problem.

recently reportthe PCA noted that poor planning and high state and local taxes are impacting the affordability of Australian housing.

Federal, state and local government taxes, surcharges and levies account for between one-third and 40% of the cost of building new homes, which is best described as “killing” housing affordability. agency said.

Another problem identified in the report was the inability of the three levels of Australian government to secure adequate supply pipelines for new homes and apartments.

“If we are serious about improving housing choice and affordability, we need to change the tax system ASAP,” he said.

“This would not only create a level playing field for rental housing, opening up much-needed new housing streams, but also increasing the supply of retirement living communities and student-only accommodation. I guess.”