Government investment in housing improvements could stimulate economies and enhance public wellbeing, according to new research

By Shannon Jenkins

September 23, 2020


The federal government must develop adequate regulatory settings and investment programs to boost the provision of thermally efficient rental housing in Australia, according to a new report from the Australian Housing and Urban Research Institute.

Authored by researchers from the University of Adelaide, RMIT, and the University of South Australia, the report has presented a number of energy hardship intervention measures for low-income renters in Australia.

Up to 40% of Australian households which rent their housing experience energy hardship, the study found.

“Many of these households are forced by market pressures to live in homes that are expensive to heat and cool due to a lack of minimum energy performance standards,” the report said.

“Existing and new technologies present an opportunity to improve housing energy efficiency through retrofitting, and to reduce the cost of energy through ‘bulk-buy’ pricing schemes … However, current policy settings focus mainly on home owners — further specific attention for renters is required.”

Exposure to energy hardship was more likely when vulnerable people live in dwellings that were in poor condition. To improve thermal efficiency and reduce energy hardship, responses must be tailored to different tenant cohorts due to different challenges across the private and social rental sectors, the report said.

It argued that the government has not yet developed adequate regulatory settings or investment programs to encourage the provision of thermally efficient rental housing.

“There is an opportunity for governments across Australia to stimulate local economies, and at the same time enhance the long-term wellbeing of the population, through a targeted program of investment in improvements to housing,” it said.

No single set of policies or governmental actions would improve energy efficiency in the rental housing stock, the study found. A portfolio of measures would be needed, such as mandatory building standards, targeted financial or material assistance for very vulnerable households, and investment in the public housing sector.

In regards to initiating and delivering energy hardship and housing support services, all three levels of government should focus on attaining adequate funding and creating pathways for regulatory change, the report said. It noted that prioritising tenant households’ health and wellbeing as the main objective of policy intervention would, among other benefits, present “a compelling narrative to support allocation of government resources and funding”.

Read more: Australia has a new National Construction Code, but it’s still not good enough

During consultation, government representatives voiced concerns about staffing, limited funding and narrow mandates. Funding issues, whether across federal or state governments, private investor landlords, or community housing providers, was also identified as a major barrier to policy change.

“This barrier was closely linked with the prevailing view of housing as a commodity in Australia, which some stakeholders cited as a deterrent for major policy change in this area,” the report said.

“Another important challenge … is the need to work collaboratively across government departments, different levels of government and jurisdictions to overcome discrete departmental mandates, which frame funding opportunities and areas of potential influence.”

The report argued setting minimum standards for the energy performance of rental properties would be a “critical starting point” in the reform process.

“The thermal performance of the built stock needs to be improved if better outcomes are to be achieved with respect to improving health and minimising energy costs,” it said.

“Some jurisdictions have already taken steps to achieve this goal, but it is important to differentiate the policy levers and actions available in the private rental market relative to social housing.”

While mandating acceptable levels of thermal performance across the nation’s rental housing stock would benefit the public, such requirements would likely be met with “largely unjustified” resistance from stakeholders within the property industry due to perceived added costs.

The report recommended a range of policy measures including schemes that encourage the installation of energy-saving measures — either through the tax system, grant programs or co-funding. Federal and state governments could also introduce grant programs to facilitate investment.

Mandating the disclosure of the thermal performance of properties was flagged as another major policy option.

One of the most viable pathways for enhancing thermal performance in Australia’s social housing stock, according to the report, would be investment in the public housing stock through a “comprehensive knock-down-and-rebuild program” and enhanced maintenance expenditures .

Read more: Is social housing essential infrastructure? How we think about it does matter


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