Social and Affordable Housing Shortages:
Social and affordable housing provides an important safety net for those who cannot afford housing in the general market. In 2014 a parliamentary committee noted evidence suggesting that NSW was in ‘a social housing crisis, with insufficient social housing properties to match the level of current demand and future need.’ It is likely that the situation has worsened since then. Demand for this type of housing has increased as the cost of renting in the general market has risen significantly. Natural disasters and the pandemic have contributed to housing stress, particularly in regional areas.
This paper provides an overview of social and affordable housing in NSW including estimates of shortages, NSW and Australian government policy, and recent recommendations. The paper does not examine other aspects of social housing such as concerns about maintenance. It also does not discuss government interventions to address housing affordability in the general market such as rental assistance.
The housing continuum
Social and affordable rental housing is broadly defined as rental housing for members of the community who may not be able to afford to rent in the general market. It occupies two parts of the housing continuum, which ranges from homelessness at one end to homeownership at the other end. People ‘move back and forth along the continuum depending on life events or their aspirations or capacity’.
Social housing
Social housing has a long history in NSW. Over time it ‘has evolved from supporting mostly working-class families to now supporting very low income and pension-dependent households.’ Social housing includes:
• Public housing: Tenancies are managed by the Department of Communities and Justice (DCJ). Dwellings are owned or leased by the Land and Housing Corporation.
• Community housing: Tenancies are managed by not-for-profit community housing providers. Dwellings are owned or leased by the Land and Housing Corporation or by community housing providers.
• Aboriginal housing: Tenancies are managed by DCJ or Aboriginal community housing providers. Dwellings are owned by the Aboriginal Housing Office or by Aboriginal community housing providers.
Social housing tenants are required to pay between 25% and 30% of their income in rent.12
To be eligible for social housing, a person must meet household income eligibility limits, not own any assets which could reasonably be expected to resolve their housing need and be able to sustain a successful tenancy, either with or without support in place.
Priority for social housing is given to those with an urgent housing need including unstable housing circumstances such as homelessness, risk factors such as domestic violence, and where existing accommodation does not meet basic housing requirements (this might be because the person has a severe medical condition or a disability). There are very large waiting lists for social housing in NSW.
As at June 2022, there were 154,600 social housing dwellings in NSW: 63% were public housing, 31% were community housing, and 6% were Aboriginal housing.
Affordable rental housing
Affordable rental housing is housing built with some form of government assistance or planning incentives to be rented by low to moderate-income households.16 This housing is mainly managed by community housing providers and private investors.
Eligibility and rents vary depending on the affordable housing scheme involved.17 Where rent is set as a discount from the market rent, the discount is usually 20%–25% of the market rent for a similar property in the area.
According to the Community Housing Industry Association NSW (CHIA NSW) in June 2021 there were 10,441 affordable housing tenancies in NSW, including 5,598 managed by community housing providers and 4,581 managed by private investors.
Comparing social and affordable housing
The Productivity Commission has noted that social housing and affordable housing share some similarities but differ in their target population and level of assistance.