Why has there been a rise in the proportion of social housing managed by the community housing sector, in Australia and overseas? In Australia, has this led to the provision of better landlord services and the delivery of additional new affordable housing?
Introduction
The development period of Australia public social housing mainly started from 1945 to 1990, while in this stage, the development in Australian social housing policy encompass a larger role for non-government housing providers. The new emphasis is mediated and supported by the discourse of ‘community’ housing sector and under its management. Much of the description which related to community housing in Australia has emphasized its claimed potential to demonstrate ways in which social housing management can be made more accountable and responsive, as well as more equitable and efficient. However, the questions which related with several issues such as the reasons for, and the outcomes of state sponsorship of community housing. (Darcy,1999). Besides, there are four roles of social/affordable housing as conceptualized by Stephens which contribute to the equitable and efficient (Fitzpatrick&Pawson 2014).
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Social landlords have always been involved in the surveillance, classification and regulation of their tenants’ behavior, through mechanisms including tenancy agreements, inspections, warnings and, ultimately, eviction (Flint,2006; Ravetz, 2001). With growing number of social housing, the landlord services have improved at the meantime. The services provided by social landlord including back office functions, new housing development and renewal and governance related activities-include reporting to oversight bodies and so on. Besides, there are motivations for social landlord performance measurement.
This essay will elaborate the reasons why there has been a rise in the proportion of social housing managed by the community housing sector in both domestic and international and the changes in landlord services and the delivery of additional new affordable housing.
The Proportion of Social Housing Management
Social housing in Australia mainly developed from 1945-1990 and it was originally targeted at returning servicemen and ‘working families’ but in the post 1975, the social housing was increasingly rationed to the most vulnerable. To be more specifically, the NSW social housing system provides housing products and services to individuals and families in housing needs (NSW Govt 2017). And they believe the system can have a more positive impact on people’s lives by providing greater opportunities and pathways towards client independence, particularly for people of working age, children and young people. In order to meet the demand of the social housing applicants and improve the work productivity, private and community sectors are also getting more involved with the career, which can more implement the outcome of conceptualising social housing roles. The Government is committed to working alongside the non-government and private sectors to drive the innovation required to meet these objectives. Figure 1: Social Housing as % of total housing stock (Bar chat sited from Gilmour 2019)
A fair social housing system supports people by prioritizing those who need it most. Under the current policy framework, social housing has increasingly been used as a support for people who cannot access low cast housing in the private rental market. In order to reduces the system’s capacity, the government will provide long-term assistance to people with short-term needs, so that it can assist more people (NSW Govt 2017). The social housing system should provide the sense of safety for vulnerable people in the community. The community housing sector are more understanding the local housing and environmental conditions which can contribute to the management of the housing system.
A fair social housing system is also one where tenants value the support they are receiving, by taking care of their dwelling, paying rent and contributing positively to their community. Transparent prioritization and allocation processes are also critical parts of a fair social housing system. With the increasing services, social housing providers are entering into partnerships with real-estate agents, to assist clients with a range of issues to access and maintain their accommodation, and provide the real estate sector with confidence in the community sector to assist vulnerable people in sustaining their tenancies.
Through Asset portfolio provided by The discussion paper for input and comment of Social Housing in NSW, there are 150,000 dwellings in NSW social housing system which is the largest system among Australia. This constitutes 5% of all housing stock in NSW, a higher proportion of dwellings than in Victoria (3.5%) and Queensland (3.3%), and more than a third of all social housing dwellings across the country (NSW Govt 2014). Among all these 150,000 dwellings, 74% are owned and managed by LAHC (Land and Housing Corporation) and CHPs (Community housing providers). The remaining 15% are owned and managed through a range of ownership and management configurations. The growing number of percentages also reflects that the governments need the understanding of the local complex conditions from the community sectors.
As well as in United Kingdom, the third sector did better than the others in employment services, but the private sector came out best in domiciliary care for the elderly (Purkis 2010). According to the database of the profile of the tenants of social housing, the percentage of house members around 55 years old to 75 years old is 34%. The percentage of the age group from 25 to 54 years old is 33%. The community and private sector take more care of the aging group, so that through consideration is one of the reasons why there is an increase of the proportion of social housing managed by the community housing sectors.
Landlord Services
As a landlord, community housing providers will have a lease with tenant under the Residential Tenancies 2010. The lease will outline the rights and responsibilities of the landlord and tenant according to the law (NSW Govt FACS 2019). During the usage of the social housing, repairs and maintenance are also the issues should be mentioned. The community housing organizations are responsible for the repairs and the maintenance of the property including organizing emergency repairs.
With the increasing proportions of the social housing managed by the community sectors, the services are more considered locally. And the services according to the local conditions can be considered more reasonable. The tenant surveys show that tenants that live in community housing properties are very satisfied with the services that was provided by the landlord. And they are satisfied with the conditions of the homes they lived in. Family and Community Service (FACS) also monitors the performance of community housing providers to ensure they continue to provide quality services to tenants.
The social landlord non-housing management activities contains three main aspects which are (Gilmour 2019):
- · Back office functions
- Financial management
- Human resource management
- Information systems
- · New housing development and renewal
- · Governance-related activities – include reporting to oversight bodies
To address the issues from the tenants, the tenants must seek to resolve any issues with their community housing providers directly. There are several ways to communicate with them which they can do it in person, or by telephone or in writing to their landlords – the community housing provider. To cooperate with the tenants, the landlords must provide information about the reported complaints and appeals processes to the clients. The tenants in Australia are referenced as ‘clients’ not ‘customers’. Furthermore, tenants who lived in social housing are welcomed to join the development of the landlord’s services, while the aim of the community housing providers is to deliver services that reflect the needs of the tenants and communities. There are different approaches of tenant participation according to different community housing providers. Some tenants are getting involved with the management boards and others run local management committees. The community housing provider also can offer the information of the current issues and events to the tenant who wants to join.
The national Regulatory code sets out the requirements of the performance of the providers which are the landlords. They mush comply under the National law. It focuses on the achievement of outcomes in the following areas (NSW Govt FACS 2019):
- Tenant and housing services
- Housing assets
- Community engagement
- Governance
- Probity
- Management
- Financial viability
Affordable Housing
Through the report from the NSW government report of Social and affordable housing need, the Growth in the need of affordable housing is projected to 2036 based on regionally differentiated population growth estimates produced by ABS and assumes no shift in the distribution of household types and incomes. Also, housing need is separated into two categories. The first are households deemed to be in need of ‘social housing’ and includes only households in the bottom income quintile for Australia and who are in private rental stress, combined with homelessness figures. The second category relates to households in need of ‘affordable housing’ which imply lower levels of housing subsidy and includes households who were assessed as being in housing stress who are in the second quintile for Australia.
Figure 2: Affordable Housing Needs to 2036 by Statistical Area Level 4
(Charts sited from Tory, Van den Nouwelant & Randolph 2019)
Through the figure, it is obvious that the demand of affordable housing in Melbourne, Perth and Sydney are much higher than other regions. Brisbane also has a high demand of affordable housing. In contrast, Adelaide and Hobart have low needs.
Furthermore, there are also eligibility for affordable housing. It most depends on household income, which must be within limits set by the NSW and /or Commonwealth Governments. The more people, including children, living in a household, the higher the household income is allowed to be.
According to FACS NSW, other factors may also be considered when assessing eligibility, including:
- Australian citizenship or permanent residency
- Whether the household would be able to sure suitable or adequate housing in the private rental market
- Whether the household owns any assets (for example, a property) which they could be reasonably expected to use to solve their housing need.
Moreover, there are four models for affordable housing provision which are (Tory, Van den Nouwelant & Randolph 2019):
- Operating subsidy model
- Capital Grant model
- Mixed tenure Market Sale Capital Grant model
- Private Equity Finance Operating Subsidy model
For operating subsidy model, the annual operation payment is in a period of ten years or more, while the development funded wholly through private finance. Through private finance, there is a financial plan which is 1.5 percentage point discount on interest rate based on commercial rate of 5% interest. Secondly, as for the capital Grant model, the development costs met by upfront payment (cash and/or land). For the third model, the market cross subsidy assumed from a 50:50 market sale/affordable rental development. And the market cross subsidy dwellings sold at median market dwelling price in local area. Finally, for Private equity Finance operating subsidy model, it assumes 50% equity with gross rate of return of 5% and assumes GST, stamp duty and land tax liable are (Tory, Van den Nouwelant & Randolph 2019).
The affordable housing needs analysis identified households in the Q2 income quintile that were in private rental stress, as well as estimate the average rent payable by those households at 30% of their incomes. For costing housing delivery, the rents that has been estimated have been compared with a median market rent, which the market rent is lower than the affordable rent. And there is an assuming that there is no affordable housing in the area.
Besides, though the delivery of the affordable housing is increasing, it still can be affected by the variable geography. The costings of affordable housing are based on the geographically specific needs and geographically specific development costs. This means that in different housing market contexts, the subsidy requirement is not even. Unlike broader population incomes, income of the bottom quintile households is relative flat, which is based on the same rates of payments for the various Government pensions. The same geographical variation in land costs also influence the costs of provision of affordable housing for the Q2 household cohort (NSW Govt 2014).
In another words, the subsidy framework should consider the geographic variations in provision.
In Conclusion
This essay illustrates why there has been a rise in the proportion of social housing managed by the community housing sector in both domestic and international. It is mainly based on the consideration of the local complex contexts, work efficiency and the growing demand of the social housing. Community sectors can also provide suitable events and problem solutions according to different conditions, such as community diversity, vulnerable groups, nature environment and social demands. Also, with the growing proportion which under the management of the community sectors, the community social housing providers which is the landlords need to improve the landlord services to meet the needs of the tenants, also called the clients, to improve the living conditions. The involvement of the clients to the management of the community also contribute to the services of the landlord. The aim of the landlord is to provide opportunity and pathways for client independence, to establish the fair system and try to achieve sustainable of the system. With the increasing demand of social housing and the improvement of the landlord services, the affordable housing market has a higher delivery requirement. As long as the system provide more opportunities for the clients, the willing of approaching the dwellings will increase. There will be models for the provisions of the affordable housing which are operating subsidy model, capital Grant model, mixed tenure Market sale capital Grant model and private equity Finance operation subsidy model. However, according to the variable geography, different housing market contexts will cause uneven subsidy requirement which might be the limitation of the development of the affordable housing.
References
- Flint, J. (2006) Housing, Urban Governance and Anti-social Behaviour: Perspectives, policy and practice. Bristol: Policy Press.
- Fitzpatrick, S. & Pawson, H. (2014) Ending security of tenure for social renters: transitioning to ‘ambulance service’ social housing? Housing Studies Vol 29(5) pp597-615
- Gilmour, T (2019) Social housing management practices, principles, metrics; UNSW Sydney
- NSW Govt (2014) Social Housing in NSW: A discussion paper for input and comment; Sydney: NSW Govt
- NSW Govt Homelessness NSW Website (accessed October 2019) Sydney: NSW Govt
- NSW Govt (2014) Social Housing in NSW: A discussion paper for input and comment; Sydney: NSW Govt
- NSW Govt Homelessness NSW Website (accessed October 2019)
- Purkis, A. (2010) Housing Associations in England and the Future of Voluntary Organizations; The Baring Foundation, London
- Ravetz, A. (2001) Council Housing and Culture: The History of a Social Experiment. London: Routledge.
- Tory, L., Van den Nouvelant, R & Randolph, B (2019) Estimating need and costs of social and affordable housing delivery; Published by City Futures Research Centre, UNSW Built Environment, UNSW Sydney
- Wigglesworth,R., Kendall, J (2000) The impact of the third sector in the UK: the case of social housing; Civil Society Working Paper 9
- The department of Family and Community Services (FACS) 2019, Australia, accessed 10 October 2019
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