Social Housing in Australia rose to prominence in the post Second World War period where State Governments combining with the Federal Government played an active role in supporting housing for members of the community which were less fortunate and unable to afford a home of their own. This aligned with the ‘egalitarian’ society which evolved after the second world war in Australia but has been in notable decline over the last 3 decades.
Social housing is rental housing that is funded or partly funded by government and is managed by the Government or a non-for-profit or non-government organisation. Using Western Australia as an example, the primary provider of social housing is the State Government’s Department for Communities (Housing) and this organisation is supported by a number of non-for-profit organisations such as Foundation Housing and Access Housing.
Social housing provides for Australians who have difficulty accessing housing in the private market and usually includes people who are homeless or at high risk of becoming homeless, such as people living with a disability, single parent households on low income, Indigenous households and people escaping domestic violence. Typically, tenants of social housing pay rent that is lower than the market rate with the remainder subsidised.
Social housing consists of the following:
Public housing dwellings – owned and run by State Government organisations
State owned and managed indigenous housing – owned and run by State Government organisations exclusively for aboriginal and Torres Strait Islanders
Community Housing – rental housing managed by community groups
Indigenous Community Housing – housing managed or leased by Indigenous organisations for Indigenous and Torres Strait Islander people.
With housing affordability being at a all time low across the country, you would think that Social housing would feature prominently in Australia as the government tries to support housing where the market has failed. In reality however, social housing in Australia peaked in 1991 where it consisted of 7.1% of all housing in Australia. By 2021 this percentage has dropped to just 4.8% at around 440,192 dwellings across the country. The decline in social housing across Australia is largely caused by the rise in the private rental market which has exploded since the 1990’s prompted by the deregulation of the banking industry in the 1980’s and the advent of Negative Gearing tax laws in the mid to late 1980’s which encouraged private investment in the property market at a scale not seen before in Australia. This has seen a dramatic increase in investment properties in Australia with investment properties now accounting for a third of all properties in Australia at 32%, with owner occupiers making up 63% and social housing at just under 5%.
Many think that the private rental market makes up for where social housing doesn’t, but in reality with rental vacancy rates across the country being at all time lows – rental vacancy rates in Perth for example is just 0.6%, rental prices have skyrocketed, with many working Australians now unable to afford rent on modest housing. This is evident in the growing waiting list for social housing in Australia. The public waiting housing list in Australia continues to grow and currently sits at 163,508 households across the country. With a tight rental market and rising interest rates and cost of living, this will only see this figure grow with projections showing that by the end of 2022 figures could be as high as 200,000 households nationwide.
To address the shortfall in social housing, this means nearly a 50% increase in the quantity of social housing across Australia which is a big ask. The last time the Australian Government intervened into the property market on this scale was in the immediate post World War 2, period where between 1946 an 1953, over 110,000 homes were provided across the country to house returning war veterans. Could a similar investment by government be possible? This will be challenging given the sheer scale of the investment which exceeds 10 billion dollars nationwide in 2022 dollars.
In recognition of the problem some State Governments are reacting to the challenge, with the Victorian Government committing to the delivery of a further 12,000 social housing dwellings between 2021 and 2024. The Western Australian Government is also committing to a further 3,100 social housing dwellings between 2021 and 2024. Whilst a step in the right direction, I think we can all agree this is well below what is required on what is a growing issue nationwide.