Developing Sustainable Affordable Housing in Australia

Introduction:

This study examines how contemporary Australian affordable housing projects are designed, financed, developed, and managed. The study aims to deepen understanding and raising awareness of the various trade-offs that shape the design and development of affordable housing projects in Australia, and suggesting ways in which such trade-offs can be managed to deliver outcomes that are socially, environmentally, and financially sustainable.

The study also offers a tool for project-level evaluation of affordable housing. Governments across Australia are increasingly turning to not-for-profit housing providers to help address shortages in housing that is affordable to low and moderate-income households. Consequently, various new forms of affordable housing projects have been developed or procured by not-for-profit organizations in recent years. Previous research has examined some of the challenges faced by not-for-profit organizations involved in this rapidly emerging industry and has focused on organizations or the wider policy and regulatory contexts in which they operate. The focus of this study is on delivery at the project level, using a sample of eight affordable housing projects that have been selected on the basis of specified criteria.

Focus and purpose of the study:

Building on the existing body of knowledge related to the affordable housing industry in Australia, this study specifically examines a selection of recent affordable housing projects that have been delivered by not-for-profit providers to evaluate their performance. Milligan first drew attention in the Australian context to the desirability of systematic evaluation of the emergence and development of an affordable housing industry. They proposed a multilayered approach to evaluation, covering five dimensions of affordable housing policy and provision:

1. National evaluation of overall processes and impacts of national policy (system level).

2. State level monitoring of housing market efficiency with a focus on the relationship to housing affordability.

3. Case studies of projects with specific features, exemplary practice.

4. Evaluation of component programs, strategies, processes or tools.

5. Longitudinal and periodic studies of client outcomes.

Affordable housing:

The term ‘affordable housing’ can be explained in a number of ways. In its broadest sense, it can refer to any type of housing (market or non-market provided) that is rented or purchased at a cost that is not beyond the financial capacity of a household. A typical yardstick used for defining housing affordability stress in Australia has been when housing costs exceed 30 per cent of a household’s gross income. Definitions of housing costs typically include expenditure on rent or mortgage payments and on rates, property taxes, household insurance, repairs and maintenance where these are the responsibility of the resident. Other costs, which may be related to housing, such as utility payments, are considered by some but not all researchers as housing costs.

A sustainability framework for analysis:

A three-way sustainability framework has been chosen for the project level analysis. This involves giving consideration to the ways that the projects contribute to financial, social and environmental sustainability goals for affordable housing.

Housing policy context:

The emergence of a third sector of affordable housing developers in Australia is comparatively recent found that less than 1200 additional dwellings had been initiated by not-for-profit developers of affordable housing. At the end of 2007/08, the largest and best established developers owned over 5440 dwellings and had plans to finalise procurement of at least another 2330 in the near future. While there has been no systematic data collection since that research, the advent of the National Rental Affordability Scheme (NRAS) in 2008 and the Social Housing Initiative (SHI) in 2009 have provided further impetus to the development of additional affordable housing by this sector.

Sustainability In Affordable Housing Projects:

The notion of sustainability is very broad and used in different ways by different researchers. The World Commission on Environment and Development defined sustainable development as ‘meeting the needs of the present without compromising the ability of future generations to meet their own needs’. In the context of housing, Priemus defines sustainability as the minimisation of negative impacts of housing development on the environment. Lawrence takes a broader perspective by considering not only the environmental but also the social impacts of housing development take a systems viewpoint, defining a sustainable housing system as one that is fiscally sustainable and allows successive generations to gain access to appropriate and affordable housing.

Conclusion:

The principal aim of this research has been to raise awareness and understanding of the various challenges and trade-offs that shape the design and development of affordable housing by not-for-profit housing organizations, with a view to identifying both best practice and desirable shifts in current policy settings to facilitate the growth of the sector. By adopting a sustainability assessment framework, analysis of eight case studies has been used to showcase the high quality of affordable housing as an alternative to both public or private rental that is becoming available to lower income households in Australia, albeit in small numbers so far.

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