Last month, Shelter NSW lodged submissions on the draft affordable housing policies prepared by Lane Cove and Woollahra councils. We commended both councils on preparing these important strategic policies, underpinned by Affordable Housing Contribution Schemes (AHCS).

The preparation of those AHCS continues a valuable and encouraging trend; more and more local governments are recognising that development must support socio-economically diverse and inclusive communities, that affordable housing is essential social and economic infrastructure, and are developing planning policies to deliver it over the long term.

You can read Shelter NSW’s submissions to Woollahra Council and Lane Cove Council online.

Shelter NSW welcomes both councils’ commitment to treating affordable housing as a permanent community asset, by retaining affordable housing in perpetuity and partnering with community housing providers – who are regulated, not for profit organisations – to deliver and manage housing that is safe, secure, and affordable for people living on lower incomes. Shelter NSW’s main recommendations were centred around the need to apply high levels of mandatory contributions to maximise community benefit through rezoning and planning decisions, and encouraging Councils to retain flexibility in how they accept contributions, i.e. considering cash contributions as well as in kind to maximise affordable housing delivery.

Another long-standing trend, unfortunately, is that rental ‘affordable housing’ delivered through the planning system is often:

• replacing older private rental market dwellings of lower quality, but that are also cheaper to rent.
• rented at a 25% discount to market rent, remaining unaffordable to people living on lower incomes in many areas of Greater Sydney and across other high-cost housing markets.
• delivering limited community benefits and allowing property developers to capture significant amounts of development value, as shown in Shelter NSW ‘Density Deals’ research.

Recent public attention, including the ABC Four Corners investigation into affordable housing, has put our long-held concern that ‘affordable housing’ is still out of reach for too many people in the media and public spotlight.

Shelter NSW has long been advocating for definitions of ‘affordable housing’ linked to occupants’ income and securing affordable housing in perpetuity. How could tying affordable housing rents to market rents address the unaffordability issues created by the market itself?

While many local councils do require income-based rent setting models, this should be implemented consistently across NSW. And this is an easy fix.

Shelter NSW calls for the NSW Government, to amend the NSW Affordable Housing Ministerial Guidelines to require that all capital-A Affordable housing – including dwellings delivered through the planning system – be rented at levels linked to household incomes – not simply offered at a discount to market rents – and remain affordable in perpetuity.

For all the legitimate concerns about ‘affordable housing’, let’s not understate the much-needed value that it can offer. Affordable housing remains one of the smartest investments governments can make. Compared with direct government construction, planning-based affordable housing contributions capture a share of publicly created land value and convert it into permanent community benefit, at relatively low cost to taxpayers. Well-designed affordable housing helps people living on lower incomes, including essential workers, remain close to employment, reduces housing stress, supports local economies, strengthens social diversity and prevents homelessness.

But planning and regulation must ensure that these benefits are truly secured, and this requires proper definitions. If housing labelled “affordable” is not genuinely affordable, or if it can evaporate into the private market after a short period, the concept risks losing its social licence. Shelter NSW’s team members regularly hear community members, academics, housing professionals, and affordable housing tenants themselves express concerns that affordable housing is: not that affordable; not that accessible; and not that regulated. In short, it’s better than nothing, but it’s not (yet) good enough.

Protecting the integrity of affordable housing surely means ensuring that it is genuinely affordable to the households who need it most, genuinely accessible and easy to apply to – we have been advocating to the Registrar of Community Housing for a public, centralised application system, but our calls have not been heeded so far – professionally managed by not-for-profit community housing providers, and retained in perpetuity.

As more councils across NSW develop affordable housing policies and contribution schemes, Shelter NSW will continue advocating for policies that maximise long-term public benefit; so that we can go back to talking about capital-A Affordable rental housing, not just housing that’s more affordable.