Grand designs: will NSW’s big social housing flip work?

By Ashley Carolan

Thursday September 14, 2017

Sweeping city views, designer-style kitchens and bathrooms and living green walls may be hallmarks of Sydney‘s prestige apartment market, but they’re also features that will soon appear in new social housing builds as the New South Wales government sets about (lucratively) flipping its existing stock.

After copping a sustained hammering in parts of the media for selling-off hundreds of inner city terraces and blocks, the state government this week released details and images of two projects it believes reveal the future of what social housing should be.

Make no mistake, it’s a fundamental departure from the mentality that public housing must be so rudimentary it’s effectively punitive.

Today, the biggest message the NSW government is pushing is that social housing needn’t be a soulless bare-bones dwelling, the kind where poverty and disadvantage are concentrated into blocks of units so drab and conspicuously down-market they jar against neighbouring housing stock.

Integration, not isolation

One of the first builds NSW Treasurer Dominic Perrottet (not a fan of Brutalism) and Minister for Social Housing Pru Goward are pumping is the decidedly downtown “Foyer51” project that will provide “51 studio style apartments and intensive support services as well as 24/7 onsite care” for young people who have been in “out of home care”.

Put more simply, it’s a direct supply-side intervention to make options available to an already-vulnerable group — one already at risk of homelessness and negative interaction with the justice system — by providing access to accommodation, education, training and employment opportunities.

Foyer51 is also a conspicuous demonstrator of “social impact investment” where governments basically bowl-up problems for external parties to try and fix, funded by a bond that typically provides an as-good or better rate of return to investment-grade products.

“As a government we want to ensure a level playing field for young people who have missed out on some of the advantages others have had. Foyer51 is an outstanding example of what can be achieved when the not-for-profit sector and government work together,” Perrottet said.

The NSW government is committing “up to $33 million over the life of the bond” used to fund Foyer51 that will be managed by Social Ventures Australia. St George Community Housing will build Foyer51 with Uniting managing the operation of the centre.

The City of Sydney, which recently had a stand-up row with the state government over who should shift a large homeless camp in Martin Place, is also shelling out $3 million towards the initiative.

Good behaviour bond for developers

There are bigger moves afoot too.

Premier Gladys Berejiklian and Goward, who is also the Minister for Family and Community Services, this week launched the second phase of the $1.1 billion Social and Affordable Housing Fund that boosts the number of new social dwelling builds by 1200 to 3400 in total.

Blending in: 3400 new social housing dwellings.

Again, those houses and units will be blended in with private stock rather than constructed as stand-alone ‘Housing Commission’ estates or suburbs on the city fringes that many believe act to isolate occupants and entrench disenfranchisement.

The Premier said the second stage would “ensure residents are connected to transport, jobs, education and tailored support services” while Goward said the new builds would help people “break the cycle of disadvantage and work towards greater independence”.

The demographics of who needs and gets to live in social housing are changing too.

Berejiklian said an increasing number of older women now experienced “housing stress” and were in need of affordable housing and support services.

“It is very important that we make affordable housing available for older women in our community. We hope to see proposals in phase two of this program that include this vulnerable cohort,” she said.

Supporting the so-called ‘hidden’ cohorts of disadvantage – people who are actually experiencing poverty and financial stress but manage to limit the visibility of its effects – has been a particular target for Berejiklian, who named housing affordability as a key priority when she succeeded relapsed banker Mike Baird as Premier.

Will banks bite?

So far Berejiklian has had few qualms about strongly pushing the private sector to do much more to make housing more equitable, especially banks and developers creaming the Sydney housing boom, who are being told to integrate affordable and ‘key worker’ stock into their developments if they want access to major urban renewal projects sited on new high capacity transport corridors.

Private market standards for public housing?

Prospective sites include ageing 1960s public housing tower blocks and low-rises in inner city locations like Waterloo that are slated for redevelopment when the Sydney Metro arrives in coming years.

One of the key architects of the ambitious NSW social bonds program and the plan to put public housing stock to work as a property asset for the state (rather than an ongoing cost and liability) is former state Treasury chief Rob Whitfield, who was recently appointed the board of the Commonwealth Bank of Australia.

Whitfield’s appointment has led to speculation that he is the CBA’s next chief executive in waiting following the resignation of Ian Narev after multiple bruising run-ins with regulators.

A more conspicuously caring bank that is publicly seen to be backing more affordable housing and social ventures as opposed to just raking in the spoils of a boom is not beyond imagination.

Meanwhile, the state’s Independent Pricing and Regulatory Tribunal has run its ruler over the NSW government’s considerable social housing estate and whether its existing rental model is working. IPART says it isn’t.

“This funding model is financially unsustainable,” the tribunal’s final report said. “It has resulted in the supply of social housing not keeping pace with demand, and has not allowed existing social housing assets to be maintained in acceptable condition. Thus, it is eroding the benefits of previous investments in social housing and adding to the already rising costs of meeting future demand.”

The IPART report cited NSW Family and Community Services estimates that put the number of households living in social housing in the state at 140,000 with another 60,000 presently on the waiting list.

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