Affordability – good news for the City’s renters

Approval for the City of Sydney to extend its affordable rental housing scheme across the local government area won’t solve the housing crisis but it will provide help for a great many people.

Shelter NSW Senior Policy Officer, Cathy Callaghan, for the South Sydney Herald on June 1st, 2021.

Much has been said about what we have learned from the Covid era. There’s the obvious appreciation of a well-funded and organised public health system and workforce of course. Beyond that, we think there has been some strong reminders about home, community and the workers who keep the place running.

Have you noticed the local supermarket staff? The nurses patiently working at Covid testing stations in your local area? Ever wondered where they live?

Unfortunately, and well before the pandemic, Greater Sydney, and the local government area of the City of Sydney has become increasingly unaffordable for ordinary people to live in. The forces of gentrification and an overstimulated housing market have combined to make the city unaffordable especially for renters in the private market.

There’s a fair chance that the workers we spoke of have been forced out of the city.

The City of Sydney has calculated the housing crisis to be so great that it will require an additional 1,971 social housing dwellings and a staggering 10,000 affordable rental dwellings between 2016 and 2036.

The responsibility for delivering social housing falls squarely in the lap of the NSW government. There is lot to be done there, but all levels of government have a role to play in delivering affordable rental housing.

Earlier this month, Rob Stokes, Minister for Planning and Public Spaces, announced his approval of the City of Sydney’s proposal to amend its planning controls to extend its affordable rental housing scheme across the local government area. This is good news.

These schemes will require new development to make a financial or floor space contribution towards new affordable rental stock. The rates will be 3 per cent for residential and 1 per cent on non-residential floor space phased in over the next couple of years. Developers will be able to provide this through a direct dedication of affordable dwellings or by a monetary contribution. The City has had similar schemes in operation at Green Square, Ultimo/Pyrmont, and Southern Employment Lands for many years now. These schemes have been successful though limited in their geographic reach. The City estimates that close to 1,000 affordable units have been delivered – a long way short of the 10,000.

The announcement of this approval is good news for the people of Sydney. It offers something practical for a group that is often overlooked – financially stressed, low- to moderate-income renters in the private residential housing market. The scheme will be pitched at these households and charge rents that are no more than 30 per cent of gross household income. Affordable housing properties are usually managed by not-for-profit community housing providers like City West.

Our vision of Sydney is one of a socially diverse residential population, representative of all types of income, culture, family, and household types.

The lack of diverse, affordable rental housing has “hollowed out” the city, driving people on ordinary incomes further out. This includes important key workers from the Aboriginal community who may traditionally have lived in the communities they service. This hollowing out threatens communities and the economic viability of the city.

The overall housing system is over-stimulated with taxation incentives distorting what should be one of the most important and basic areas of public policy – ensuring everyone has a secure and affordable roof over their head.

While all levels of government have a role to play in addressing the housing affordability crisis, we often see local government missing in action. We commend the City of Sydney for persevering over a number of years to produce a municipality-wide plan for boosting the stock of much needed affordable rental housing. It won’t solve the housing crisis but it will provide help for a great many people.