Goal 4: Increasing Affordable Rental Housing

This goal focuses on how the ACT Government could grow the stock of affordable rental properties in the community and private rental sectors, and improve the equity and efficiency of the Territory's rental stock.

Key objectives

Key opportunities

Strong population growth, low unemployment, high average wages and a transient population are having a considerable negative impact on housing affordability in Canberra's traditionally tight rental market.

Rental vacancy rates have remained at or below 1% for the past six years. With a total pool of around 73,000 private rental properties, finding an affordable rental property among the 730 or so that are typically available at any one time is very difficult. Moreover, properties within reach of low income families who don't qualify for social housing are typically smaller, older, less energy efficient and not well located for employment and services.

7960 low income private rental households pay more than 30% of their income on rentThe most recent 2018 Report on Government Services identified that approximately 7960 (almost 48%) low income private rental households were in rental stress; that is, paying more than 30% of their income on rent.8 For low income households, high rents are impacting on their ability to pay for other essentials, including utility bills.

Rental affordability was a prevalent theme and priority area identified during consultation on the development of the new housing strategy. The need to grow the supply of rental properties that are affordable to households that earn between $55,000 and $100,000 and can afford rents of between $320 per week up to $580 per week is a key priority of this strategy.

In addition to improving the affordability of and access to rental housing in the ACT, there is a need to provide better protections and security of tenure for low income households.

The strategy sets the course for growing the supply of affordable rental stock through the community housing sector and the private sector. Under the strategy, the government will work closely with the sector through one-on-one and group discussions with providers and working with sector peak bodies and put in place measures that address the financial challenges faced by the community housing sector in growing the sector beyond its current slow rate.

The role of the private sector in supplying affordable rental properties is a key area of focus. The strategy considers possible financial and planning incentives and plans to release a site for private investment specifically in affordable rental accommodation.

For vulnerable groups already within the private rental market, the strategy works in parallel with ongoing reforms to the Residential Tenancies Act in order to strengthen rights and protections for tenants.

The ACT Housing Strategy sets the course to unlock a supply of new affordable rental properties in the community and private sectors, while strengthening rights and protections for existing private rental tenants.

Goal 4: Objectives and Actions

Objective 4A: Grow and diversify the community housing sector

The strategy demonstrates a clear and significant commitment to growing the community housing sector.

Under the strategy, the government will work in partnership with the community housing sector to increase the current rate of growth in new properties managed by community housing providers. The government will seek the community housing sector's regular input to the setting of annual community land release targets as part of the government's commitment to release 15% of its annual indicative land release program to the provision of public, community and affordable home purchase.

The target will consider the ongoing capability of the sector to develop on these sites and will explore the viability of the government playing a role in constructing and selling properties to the community housing sector.

At the same time, the ACT Government will investigate mechanisms to reduce the cost of land to address the yield gap that exists in renting properties at a reduced market rate.

The ACT Housing Strategy aims to facilitate partnerships between community housing providers and either the private sector or current lessees of underutilised land to grow the stock of community housing.

Actions

Objective 4B: Grow the supply of affordable private rental properties

The ACT Housing Strategy responds to the need to encourage and incentivise private landlords to supply affordable rental properties to the market.

Under the ACT Housing Strategy an Affordable Rental Real Estate Model will be established that will manage properties on behalf of private landlords at below market rent. These properties will be targeted to families that do not qualify for public housing but would pay a significant proportion of their income in the private rental market. To help establish this program, the government will investigate financial incentives for private landlords to contribute their properties into this market.

A home sharing pilot program will be introduced to better utilise existing housing across the ACT. Funding will be made available to a provider to run a service of matching pre-qualified tenants with existing home owners with space in their home that is suitable to share. The model will be based on the HomeShare Australia and New Zealand Alliance Incorporated model.

The ACT Housing Strategy responds to the growing interest from the private sector in constructing new affordable rental properties. A number of measures will be investigated including incentives through lease variation charges and planning controls.

The ACT Housing Strategy will commit to an expression of interest process on a specific site to potentially facilitate new affordable rental housing through a build-to-rent model.

Actions

Objective 4C: Strengthen rights and protections for tenants

The strategy responds to concerns raised during consultation about issues faced by vulnerable tenants in the private rental market.

The government will focus on the experiences of these tenants and look closely at how tenancies are ended, in what circumstances, and how much notice is required to end a tenancy so renters can expect fair decisions about their homes.

Reforms to the Residential Tenancies Act will promote model behaviour by landlords in terms of setting rent, administering a tenancy and making decisions that will impact on tenants, including decisions about pets and minor changes to a property. The strategy encourages rental increases to be fair and that the process considers hardship and housing security as top priorities.

Action

Objective 4D: Provide targeted advice and support to tenants and landlords

Navigating and understanding the rental market in the ACT can be difficult for some low income and disadvantaged households. Consultation highlighted the difficulties in being aware and in understanding the existing support measures available to landlords and tenants.

Secure, appropriate rental accommodation is a key component of the strategy. This extends to those already in rental accommodation who are at risk of eviction or unfair treatment. The strategy looks into the effectiveness of providing specific support to tenants and landlords to maintain existing tenancies through a targeted communications campaign.

Action

Objective 4E: Target programs to increase supply of affordable housing for vulnerable and disadvantaged households

Two specific projects will be progressed under the strategy that respond to issues faced by vulnerable and disadvantaged households.

The government will provide seed funding through the Affordable Housing Innovation Fund for a project that responds to the housing and accommodation needs of families escaping domestic violence and will provide equivalent funding for a development project for people living with a disability. These pilot projects will provide government with an understanding of development feasibility with a view to continuing and increasing the provision of this type of accommodation into future years.

The strategy establishes priority categories that will provide greater access to home ownership and low cost private rental opportunities for vulnerable and disadvantaged households.

Actions

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