Joining the dots on affordability

This week is Budget Week for New South Wales. There's still time for the Berejiklian Government to announce the forgotten part of their housing affordability package - the one that tackles Sydney's high rents. So far they've covered tweaking taxes and grants in favour of first home buyers over investors, and fast-tracking supply. But they've left off any policy that would directly affect the rent.

As we've noted before, the shift of incentives from investors to first home buyers is designed to have the strongest impact in the market for newly built properties. We've also previously noted that while the majority of investors do not purchase newly built properties, there has been a significant increase in investor driven demand lately for off-the-plan units. It is worth considering how this change will impact demand for new dwellings over the next few years.

Understanding your standard first home buyer is no easy task. We can go back to the ABS Feature Article from 2012, First Home Buyers in Australia, which tells us that just prior to the height of Australia's post-GFC first home buyer boom there were about 430,000 of them over the three years to 2010. Driven by stamp duty concessions and the Rudd Government's First Home Owner Boost that put either $14,000 and $21,000 into their hands depending on whether they bought an established or new home, slightly less than one-fifth of them bought a newly built property during that time. In the three years prior to that, when the grants were not quite so generous, there were around 320,00 of them with less than one-tenth buying off-the-plan.

This tells us that first home buyers do seem to respond to stamp duty concessions and direct grants, but just like their investor counterparts they are much more inclined to buy established properties than newly built ones. Of course, this is based on how they behaved in the bad old days when property prices were merely exorbitant, but the latest Digital Finance Analytics' Property Imperative Survey suggests these numbers remain in the ballpark - they've identified 330,000 first time buyers in their March report, noting that 80% are buying or intending to buy an established dwelling. But we must note here that an increasing proportion of these first timers identified by Digital Finance Analytics are investors, so they are buying another person's home rather than their own.

Now that prices are scandalous, it remains to be seen if anything much will change after the tweaking of stamp duties and grants. It is possible that 100% of Sydney's first time buyers will rush to the new apartment market to see what they can afford, since the houses they'd evidently prefer to buy are still likely to cost too much. But it's just as likely many will continue to rent the homes they want (or can afford) to live in. Either way, the removal of incentives for investors to buy off-the-plan is likely to see them withdraw from the new apartment market, and this wont be completely offset by any increased demand from first home buyers. Construction activity may well start to fall away in response. If that happens, no amount of rezoning to fast-track supply will save us from the plague of rising rents - assuming it ever could.

This brings us back to the forgotten part of the NSW Government's housing affordability package. Given the recent Federal Budget foreshadows a new Affordable Housing and Homelessness Agreement requiring the states to consider affordable housing targets, along with an Affordable Housing Finance and Investment Corporation that will provide a funding mechanism for the supply of new sub-market dwellings, the Berejiklian Government would do well to adopt planning and zoning reforms along similar lines to those announced by the NSW Opposition a couple of weeks ago. In the face of their own affordability package that might otherwise reduce demand for their services, this could be just the tonic our developers will need - to say nothing of our neighbourhoods and communities who are already crying out for some downward pressure on rents.

Airbnb and the rent in Sydney

Today we released our report into the impact of Airbnb on the rent in Sydney. You can check out the full report here: https://tenants.org.au/tu/airbnbsydney2017. Let's have a closer look at some of the findings.

One of the interesting numbers we've examined is the number of Airbnb listings that are actually active in any given month. While it's true that people keep creating more and more listings on Airbnb, that doesn't always tell us the really important number - how many are active, and therefore what impact these listings are having on the rental market.

We really can't explore some of these issues due to the lack of data around housing in Australia. We don't know which properties are rented homes or owner-occupied, and this makes it difficult to read a lot into the numbers.

We can be clear that simply being listed on Airbnb does not mean a property has been removed from the rental market and there are two clear examples we can imagine to illustrate the point. Imagine a 2 bedroom unit in Bondi. The occupant lists the place on Airbnb for the week between Christmas and New Year's while they go away and visit family. If the occupant was an owner-occupier then this property wasn't available for rent, and Airbnb hasn't changed anything about that. If the occupant was a renter, then this property has also have not been removed from the rental sector - it is still in it.

The Greater Sydney area 

Whether it is owned or rented, what is more relevant is how often a property is booked. This chart covering the whole of Sydney from August 2014-August 2016 illustrates that there actually is a large number of listings on Airbnb which don't even receive one booked night in any given month. This suggests a large number of people have listed their property in the lead up to summer, booked it perhaps for a few nights over summer, and have no intention of listing the place again.

We can clearly see the summer bump both in December 2014 and December 2015 - far more activity then, than for the rest of the year. What is interesting though, is that the numbers of listings with 8 or more nights booked in a single month (or roughly 100 nights in a year) is much more constant throughout the year. This effect is very clear in our three hotspots with really large summer bumps in beach-side Bondi and Manly, and a still sizable but reduced bump in inner city Darlinghurst.

All of this leads us to think that for the majority of users, Airbnb activity is sporadic. However more commercial operators of course act differently, and are looking to maximise their occupancy all year round, leading to a more consistent level of activity. Regulation of short term lets should look to effectively control commercial operators, and ensure that their activity in short term lets does not produce harmful effects on residential tenants.

For the full report, including interactive maps - check out tenants.org.au/tu/AirbnbSydney2017

Celebrating Anti-Poverty week with smashed avocado on toast

Welcome to Anti-Poverty Week 2016. Everyone is encouraged to help reduce poverty and hardship by organising or taking part in an activity during the week (October 16-22).

He might not have meant to, but Bernard Salt got us off to an early start on Saturday, over at The Weekend Australian. Salt penned a provocative piece about how “Middle-Aged Moralisers” - a term with which he identifies - don’t like hipster cafes. He set off a small Twitter storm for his trouble. Quite aside from their poor quality furnishings and their complex approach to gender rules on toilet doors, Salt drew the most ire for his observation that hipster cafes are charging $22 a pop for smashed avocado on toast, and that young-people-who-haven’t-yet-bought-houses should not be paying for such frivolities. Instead, they should be directing all that hard-earned towards a deposit for a home-loan.

Now some might argue that the day young hipster-folk stop trading smashed avocado lunches is the day the Australian economy dies, and poverty comes a-calling for us all. But Salt does have a point. According to a study released by the Australian Council of Social Services yesterday, one of the surest ways to avoid poverty in Australia is to own your own home. Only 15.5% of the three-million Australians living below the poverty line in 2014 were home-owners, while 59.7% were renting.

Saving your money to buy a house may seem like a good wisdom, but many in the “haven’t-yet-bought-houses” category have already sat through that lecture. Amid confusion about whether the number of first home-buyers entering the market is very low or even lower, Salt's screed is just another reminder of the impending poverty of old age.

For those apparently well-off enough to feel the stigma and shame of not-buying-houses, rising property values are nothing to cheer about. Many who can’t afford a home today probably won’t be able to afford it again tomorrow, and will experience increasing levels of poverty and inequality as they struggle to meet rising rents. Even having a job is no guarantee of the good life - in 2014, about a third of Australians living below the poverty line were wage earners. But for those who can’t get a job, and those whose working days are behind them, the cost of housing will always be the biggest barrier to financial wellbeing.

So, for the three-million Australians who already live below the poverty line, and the countless others who will join them in the fullness of time, doing something about housing affordability will make a critical difference. Building much more Social Housing, inserting meaningful Affordable Housing targets into our planning laws, and fixing our various tax settings would be a good start.

Even if we did all of this today, slowing the growth of housing costs would take some time. Making a couple of quick changes to our renting laws would also help: allowing tenants a genuine option to challenge unreasonable rent increases, so they may respond to landlords' price signals in a manner other than moving out; and removing landlords' ability to end tenancies without a reason so that tenants will have some security in their homes for as long as they meet the terms of their agreements, and their properties remain available for rent.

In the meantime... the smashed avo looks pretty good today, if you can afford it.

Mythbusters: Boarding House Edition

'If the prostitutes and criminals don't get you, the ice addicts, deviants, and bums surely will. Why just look at them now, the usual suspects leering at you from their den of ill repute - or 'boarding house', which I do believe is the technical term:

"We'll get ya!"

I assume they paint the boarding house walls in the style of a police lineup to save time. Save yourself while you can - run to the hills (district)!'

Or so went the dominant view surrounding the application for construction of an eight-room boarding house in Cromer, on Sydney's Northern Beaches. Warringah Council's Development Assessment Panel granted development approval last week despite an overwhelmingly predictable backlash. Approximately 800 individuals made submissions to council regarding the development. According to The Sydney Morning Herald, just 0.12% - that is, one - of the submissions were supportive of the project. The record shows those 799 dissenters included Social Housing Minister The Hon. Brad Hazzard MP, Warringah Mayor Michael Regan, and the Principal of a neighbouring primary school. 

The following comments are not attributable to any of those persons, but do give an idea of the flavour of much of the opposition:

"Most [boarding houses] are filled with ice addicts, heroin junkies, paedophiles and jail birds. Please stop this from happening asap [sic].."

"Not only because there is no control over who will be living there (paedophiles???) but also because the children might be exposed to drug/alcohol related problems."

Clearly, these are serious numbers and very serious allegations. So how could the Cromer boarding house have been granted approval? Does it evince a disregard for community safety and interests? Perhaps a sign of arrogance - hubris even? The undue influence of property developers? Or could the opposition campaign be extraordinarily misguided in multiple respects?

Lock in D for the full million, Eddie. It is difficult to know where to start in debunking the opposition to what should be an entirely uncontroversial development.

But let's start with what exactly has been approved. As Warringah Council's report on the development application provides, the Cromer project may be categorised as a 'new generation boarding house'. Earlier this year, the Australian Housing and Urban Research Institute ('AHURI') released a discussion paper which defines the term. And the truth is less than earth shattering: "blocks of small 'studio apartments' or in some cases one-bedroom apartments with separate bathroom and kitchenette". And those undesirables? According to AHURI, they are largely a mix of professionals, students, and shift workers, often paying in the vicinity of $400 a week in rent.

So don't believe the hype. The Cromer development is a largely ordinary apartment block, set to be inhabited by an 'ordinary' cross section of the community. 

Somebody please think of the children!

But even if the project better resembled a more traditional boarding house, the 'addicts and criminals' claim would not hold water. As the AHURI report states, traditional boarding houses are indeed home to "some of society's most excluded and vulnerable individuals...". But the assumption that vulnerable residents bring danger and degradation is simply not borne out. 

Just look at Cromer itself. According to Fair Trading's Boarding Houses Register, its postcode of 2099 is already home to two such boarding houses. The neighbouring postcodes of 2098 and 2100 also contain one each. And there are likely more still, as the AHURI report notes: "...there are strong grounds for believing that the actual scale of NSW boarding house provision is understated by the Fair Trading register...the numbers registered with Fair Trading as at August 2014 were considerably fewer than those formally approved to operate as boarding houses by the council concerned." 

The reality is that the people the campaign so fears will move in are already living in and around Cromer, possibly in considerable numbers. And yet the sky has resolutely failed to fall. Fear and loathing inspired by the vulnerable of our community is simply wasted. 

Finally, the notion that a development application should be refused on account of objections such as those raised in this matter does not concord with how planning law works. Broadly, a development application is assessed according to its compliance with technical and dispassionate criteria, such as height limitations and permitted use. Subjective contentions such as those raised by the opposition here do not get a look in. This quote from the NSW Land and Environment Court, relied upon by the panel in approving the Cromer project, puts it best: "The consent authority must not blindly accept the subjective fears and concerns expressed in the public submissions...there must be evidence."

So forget the hysteria, loud as it may be, and rest easy. This development will not send Cromer to hell in a hand basket. Indeed, this has all happened before, as the seemingly prophetic words of a boarding house proprietor quoted in the AHURI report make clear:

"When [council] has the notification period...all hell breaks loose. There's a residents' action group that's formed, there's agitation from them, you'll have 40 people come to the Council meeting, all throw their arms up, 'there'll be derelicts here, there'll be drug dependents, etc., not in our back yard, get rid of it. Make sure you refuse Mr Council and Mr Mayor and make sure it goes away'."

Far from devastation, the Northern Beaches are as safe as boarding houses. 

Counting the Cost- Saving the Census

You may have read that the Federal Government, at the request of the Australian Bureau of Statistics, and in response to funding pressures, is considering possible changes to the ABS Census. The next Census is due in August 2016.  Check out the back story in these two articles.

Presently there is a Census every five years. There is talk about conducting the Census every ten years and, between Censuses, to collect information from samples only. We believe that a threat to timely and accurate census data is a threat to fact-based debate and data-driven policy making.

Why? Because surveys that rely upon sampling techniques do not provide useful information at the small area level which allow results to be interpreted with reasonable confidence.

This also will have a negative impact on the provision of community services across Australia, especially for vulnerable and disadvantaged groups. Just one example. The NSW Tenants Advice and Advocacy Program applies a formula for allocating funds to local Tenants Advice and Advocacy Services that draws upon Census data. A 10-year Census will not provide an accurate picture of the demography of small towns and local government areas between Censuses.

So, in early March of this year, the Tenants’ Union of NSW wrote to the Hon Joe Hockey expressing our concern. We are awaiting his reply.

Read more about why we need to keep the 5-year Census. There is also a ‘Save the Census’ letter you can send to Canberra.

An Over Occupation with Under Occupancy

We wrote recently regarding the Auditor-General's Report "Making the best use of public housing". One of the elements the Audit spent a bit of time considering was the 'efficiency' of allocating tenants with houses that fit their needs. The particular statement that caught our eye was that "only 67.6 per cent of public housing households match the size of the dwelling."

The figure of 16180 properties that have 2 or more spare bedrooms keeps coming up- it came up again in the Family and Community Services budget estimates recently.

What isn't mentioned, and doesn't seem concerning to the auditor or the government is that of the 32.4% of public housing households that do not match the size of the dwelling, more than half, or 16641 dwellings, are actually over-occupied. This includes 2482 properties that are chronically over-occupied (they require at least 2 more bedrooms than they currently have).
HNSW estimates in the Audit that under-occupancy costs the government about $25million in lost revenue a year,  but fails to mention it is currently collecting roughly the same from people who are paying to stay in premises that are less than their requirements, as determined by HNSW. 

Of course, the government might argue, we must move those people who are under-occupying into the smaller places so that those who are over-occupying can move in. This might be sound accounting practice, but the focus on under-occupying misses a key point- these figures show they do not have somewhere for the over-occupying to move to.

If we were to assume a zealously efficient overlord position and move people around in a state-wide game of human Tetris, we might try to make a straight swap between the 6230 people currently living in 1-2 bedrooms who require a 3 bedroom property, and 6230 of those living in 3 bedrooms who only require one or two (and hope that those who actually require two get two and not one), then we are still short 7230 places for those in under-occupied 3 bedroom premises. Those in 3 bedrooms who require 4 outnumber those in 4 bedrooms who require 3 more than four to one.

Let's move everyone around, trying to house those over occupying in the premises that are under-occupied, and vice versa. Using Housing NSW's numbers we end up with 13661 households who don't fit the dwellings. There are lots of 3 bedroom places that people could be moved into. However, 7593 actually only require two bedroom places, and 6068 require four or more bedroom dwellings that don't exist. So we would still both have under-occupation, and over-occupation.

Another way of looking at Exhibition 6 above

This is a best case scenario for our efficient overlord, and it ignores things like ensuring tenants are moved within localities. What we are left with is that all this talk of under-occupation will only deal with anyone on the waiting list if we continue to leave people cramped and squashed into premises that are too small- by Housing NSW's own standards.

We're for the efficient use of public housing, but becoming overly occupied with the amount of under occupation distracts government from its real issue- supplying adequate housing for the people who truly need it.

A new housing discourse for NSW Labor?

Last week NSW Labor leader John Robertson convened a Housing Summit, to hear from representatives of business, academia, local government, developers, unions and the community sector about problems in housing supply and affordability (the Tenants' Union was there, and gave a presentation on what we call the real housing supply problem: the lack of affordable rental housing for lower income households).

One of the questions of the summit was: do we need a new housing discourse?

According to many of the summit participants, the main theme of the new discourse has got to be 'density'. They say denser development – particularly in already built-up areas – will produce more housing, and make housing more affordable.

At the Brown Couch we're ambivalent about density. It's true that there are lots of nice flats and terrace houses out there, and that there's some very nice parts of town where flats and terrace houses predominate. But we've also taken too many phone calls from tenants of flats – some of them newly built – where they can hear their neighbour's every movement, and presumably can be heard by their neighbours too. It seems to us that this may not be so much of a problem for higher-income residents who have the cash and the cachet to access all the public spaces of the city and their increasingly commercialised entertainments – but it looms large for those who must look for their recreation at home.

But density is good for affordability – or is it? At first glance, getting more of something (housing) out of a given resource (land) seems consistent with getting it cheaper... but it also means you get less in each unit of housing, and that's a bit of a cheat on affordability. And let's face it, density has been a 'new' discourse for at least 20 years, and over that period our affordability problems have gotten worse. If greater density is to be achieved by restricting development on greenfield sites, and allowing some sites that already have single units of housing to be redeveloped with a multiple of units, you can see how that could push up the price of established land and housing.

And that's the thing: the decisions that push up the price of land and housing. At the risk of never again being invited to a Labor summit, consider the current inquiry of the ICAC into the allegedly corrupt decisions of a former Minister to allow certain land to be used for coal mining – land owned by another Member of Parliament, who stood to reap a windfall of many millions of dollars from the increase in its value.

Naturally, attention has been focused on the allegation of corruption in the decision about what the land could be used for. But really, even if the decision was squeaky clean, the delivery of a windfall to an individual property owner – who has done nothing to earn the increase in value – stinks.

And these windfalls are delivered not just by the decisions of governments, but by 'decisions' of the community. Where a community grows and develops and changes the way in which it arranges its various activities, such that some locations become more sought after and their values increases, those increases come from the growth and development of the community, not the work, effort or skill of the property owner.

Increases in established house prices are unearned wealth. But so many property owners seem to think that they are justified in keeping – or that they have even earned – all the gains. The most that can be said for them is that they were smart to choose to be born at an earlier point in time when they could better afford to buy the land in question.

Here's where we really need a new discourse: a discourse against individual accumulation of unearned wealth from housing; a discourse for returning a larger portion of unearned wealth, via tax, to the community.

Tenancy culture studies: public housing road tours

It's hard to believe now, but there was once a time when the NSW State Government published tour guides to public housing estates.

The NSW Housing Commission's 1947 booklet, Homes for the People, featured a handy map and directions for five road tours of public housing developments throughout Sydney. Tour 1, from Pagewood to Beverly Hills in Sydney's southeast, was a relative doddle at 42 miles in two-and-a-half hours; to do the lot, the truly dedicated tourist would cover, over 18 hours, 282 miles of public housing, from Hornsby in the north to Liverpool in the west.

The guide proudly pointed out 'items of note', such as 'experimental cottages' in Esme Avenue, Chester Hill; the 'small unit homes (one child families)' in Juno Parade, Greenacre; and the building technologies and materials employed: timber frames, steel frames, concrete, fibro....    

It was a proud publication, and rightly so. This was the era of the first Commonwealth-State Housing Agreement (1945-56), in which renting in public housing was conceived of as a decent and genuine alternative to home ownership, and the Housing Commission built one in every six dwellings built in the State.

Nowadays Housing NSW prefers its properties to be un-notable, even invisible. (Aside from the tour guide, here's another sign of the times: Housing NSW annual reports used to be full of pictures of buildings – but no people; now, there's lots of smiling faces, but no buildings.) However, public housing estates remain places where one can find some important firsts in architecture and planning and many admirable – even successful – endeavours in building better homes for the people.

Here's a few of our favourites.

1. Daceyville. See where the public housing system in New South Wales began. 'There, that is how Australia builds its garden cities' – that's what John Rowland Dacey predicted future tourists would say of the estate, and both the buildings and layout of the estate show the state of the art of early garden suburb planning. Strong radial avenues and short curving streets give the estate a symmetrical, very mannered appearance (the layout of later garden suburbs and neighbourhoods would be more closely determined by the topography); but if you look down Cook Avenue, says estate historian Samantha Sannayah, you can see that the western side of the estate, built to the earlier plan of garden suburb originator John Sulman, is more formal, while the eastern part, built to the later revised plan of Housing Board architect William Foggitt, is 'curvier, and friendlier'. The dwellings, notes another historian of the estate, Robert Freestone, are 'a blend of English cottage and Californian bungalow forms unified by verandas and Federation joinery details'; the earliest are semi-detached but built to resemble a single large house; later dwellings are detached per the suburban ideal; but then the very latest – from the 1980s – employ the large house form again.

Items of note include the first planned cul-de-sac in Australia: the tear-shaped addition by Foggitt to Colonel Braund Crescent.

2. Millers Point, Dawes Point and the Rocks. Actually, even before we had a public housing system, we did have some public housing. The State Government first acquired rental housing almost accidentally when, after an outbreak of bubonic plague in 1901, it resumed the wharves and adjoining areas of Millers Point, Dawes Point and the Rocks. Walk through Millers Point and Dawes Point and see grand and more modest houses from the late nineteenth century, and working class boarding houses, flats and terraces from the early twentieth century. Pause at Clyne Reserve and survey the wharves below and to the south, soon to be redeveloped as Barangaroo, and worry for the future of this special public housing place.

Next, duck under the Bridge at Cumberland Street and behold the Sirius apartments, from the Housing Commission's brutalist period in the 1970s. Awesome.

3. Riverwood. If you go to Millers Point and Daceyville for early twentieth century public housing, try the estate at Riverwood, 18 km southwest of Sydney, for the mid-twentieth century and beyond. The Riverwood estate presents an extraordinary sample of the various types of housing built by the Housing Commission after the Second World War: some detached cottages (mostly sold to residents); walk-up blocks of 2- and 3-bedroom flats; 'pensioner housing' (bedsits); some terrace houses; and the two 1970s high-rise towers, Jefferson and Lincoln. (All the streets, which are distinctively curvy in the suburban grid, are named on an American theme too, after the American army hospital built on the site during the war. None of the hospital buildings, at one time used by the Housing Commission for emergency housing, remain on the estate.)

You can also see the result of later programs for the 'improvement' of public housing estates – in particular, the addition in the 1990s of gatehouses and balconies on the blocks of flats, and the fencing of previously common grounds – and the beginnings of one of today's large public-private redevelopments, as blocks of flats and bedsits at the estate's northern edge make way for Riverwood North, which promises to build an equivalent amount of social housing, along with rather more units for sale to private owners. Finally, there's also the excellent Riverwood Community Centre, which got started in the 1970s under the Australian Assistance Plan of the Whitlam Government. 

There's many more places of note, of course. Still looking just at Sydney, there's Redfern and Waterloo. There's the Erskineville estate, which predates the Housing Commission (built in the 1930s by the Housing Improvement Board) and survived a proposal to redevelop it in the early 2000s, thanks to a spirited campaign by tenants and their neighbours. There's the Strickland flats, in Chippendale, a rare example of social housing built by local government (the City of Sydney, in 1914). There's Cartwright, part of the Green Valley estate, which was built in 1963 as the Commission's first instance of 'Radburn-type planning'. (The Commission explained in its annual report: 'basically the plan provides for pedestrian movement along a pathway system segregated as afar as possible from vehicular traffic. All mail and other household deliveries, garbage collections, etc will be made by means of short cul-de-sacs at the rear of the dwellings, which will also provide facilities for parking.... The adoption of Radburn-type planning for this neighbourhood was received enthusiastically by the public generally, and in particular, was favourably commented upon by many planning authorities.')

Many successful endeavours in providing better homes for the people... and some not so successful. But even in those places you'll see the endeavours of tenants and other residents and workers to get hold of the facilities and resources that planners and markets didn't deliver. There's lots to see and admire out there. 

 

Strata redevelopment proposals expose flaws in the housing system

New South Wales' first strata title schemes are now more than 50 years old; there are also plenty of even older buildings that have been subdivided into strata units over the years. With age these buildings have sustained a bit of wear and tear (some residents may feel the same about themselves!). But many are desirably-located, in inner and middle Sydney.

Developers have had their eyes on them for some time, but their designs are often frustrated by the necessity of getting every single owner to agree to sell up and terminate the scheme. Now the NSW State Government is having a look at them too.

In its current review of strata title law, NSW Fair Trading is considering changing the law about terminating strata schemes, in order to facilitate 'urban renewal'. Suggested changes include removing the requirement of a unanimous decision by owners to terminate – instead a majority would do, with some owners having to sell up against their wishes. Fair Trading is asking for feedback on what size of majority is appropriate, and whether there should be a process for owners to collectively sell their units or participate in the redevelopment.

We think that before it goes any further in considering these details, the NSW State Government should first consider the wider housing implications of such changes. We're worried that without the State Government also committing to a stronger affordable housing policy and additional investment in social housing, these changes may result in thousands of households losing relatively affordable and – in the case of owner-occupiers – secure housing.

We have identified two groups of people who we believe would be particularly vulnerable. 

The first are older, lower-income owner-occupiers. From our analysis of data from the 2011 Census, we calculate that there are about 29 000 older, lower-income owner-occupiers (aged 60+, income less than $60K, no mortgages) living in strata schemes in the inner and middle rings of Sydney. Of this group, two-thirds (66 per cent) have incomes of less than $600 per week.

These residents may have lived in their strata schemes for many years, and have deep links to the local area. They may also have no assets other than their strata unit and, if they were forced to sell their unit because of the termination of their scheme, they may not be able to afford to buy again in the same area. This is a real possibility, especially if the market for units in the scheme is limited (because the scheme is run-down, and there are insufficient funds for repairs, there may be few or no prospective purchasers other than developers). 

In the event of the termination of their schemes, these older, lower-income owner-occupiers may be faced with choosing between buying again out of their area, or renting locally. Buying and moving may mean losing their social and cultural links and connections to local services, such as medical assistance. Renting would mean at least some time spent in the private rental market, which offers very little security of tenure. These persons could apply for social housing, but may be ineligible because of the income and/or assets criteria; even if eligible, waiting times for most types of social housing dwellings in the inner and middle rings of Sydney are between five and 10 years, or more than 10 years.  

For a group that has enjoyed low housing costs and high security, and expected to continue to do so in their old age, these may appear to be a very unsatisfactory set of housing options indeed.

The second group are older, lower-income private tenants. From the 2011 Census data, we calculate that there are about 14 000 older lower-income private tenants (aged 60+, income less than $60K) in strata schemes in the inner and middle rings of Sydney. Of this group, almost 5 000 live alone, and of these, about two thirds (66 per cent) have incomes of less than $600 per week.

Unlike owner-occupiers, these residents do not enjoy secure tenure, and the available Census data do not disclose the affordability of their housing. We acknowledge that the supply of rental accommodation in inner and middle Sydney would probably – eventually – be increased as a result of the redevelopment of older strata schemes. Nonetheless, we are concerned that when a strata scheme is terminated, these residents would face an unsatisfactory set of housing options like those faced by older, lower-income owner-occupiers. It is likely that they would not be able to rent affordably in the local area, whether during the redevelopment, or afterwards when the redevelopment of their particular scheme is complete – as the new premises will almost certainly rent for substantially more than those in the old scheme, and these renters have little prospect of increasing their incomes. They would therefore have to move away, or try to rent unaffordably locally while waiting for social housing. 

These vulnerable groups of strata residents – and other residents who may be adversely affected by urban renewal – need more than legislated safeguards in a reformed strata scheme termination process. They need a better set of housing options – better than those presented by our current planning and social housing systems and tenancy laws.  

The planning system makes provision for the development of affordable rental housing, but its approach is mostly permissive and voluntary (per the Affordable Rental Housing SEPP, and some voluntary planning agreements); there is legislative provision for a mandatory approach (under s 94F of the Environmental Planning and Assessment Act 1979 (NSW)), but the State Government has restricted this approach very narrowly to only a handful of sites in Sydney. The whole of the planning system is now under review by the State Government; it has flagged that there will be a high-level ‘Housing Supply and Affordability Planning Policy’, but there is no indication yet that it will strengthen the mandatory provision of affordable housing – or even its permissive, voluntary provision. 

The social housing system is stuck in a state of no net growth, and has been for more than a decade. Given that the population is growing, no net growth means the social housing system is declining relatively. As indicated by the waiting times above, the social housing system is no longer directed to serving people who simply need affordable housing: in most cases, an applicant must experience a crisis before they are served.  Most social housing allocations (70 per cent) are now made on a priority basis, rather than a wait-turn basis (30 per cent); five years ago, those proportions were reversed (download Shelter NSW's NSW Housing Factsheet for these figures and more).

  

Our tenancy laws enshrine insecurity by failing to give even the modest assurance that a tenancy may be terminated on reasonable grounds only. Landlords continue to be allowed to give termination notices without grounds and, under provisions that commenced with the Residential Tenancies Act 2010, there is now no discretion for the Consumer, Trader and Tenancy Tribunal to decline to order termination on the basis of a no-grounds notice. This is an injustice to the tenant receiving the notice, and makes tenants as a class needlessly insecure in their homes.

The urban renewal contemplated in NSW Fair Trading's strata review may expose thousands of people to these flaws in our housing system, and place the flawed system under further stress. We're asking that the NSW State Government  review the housing implications of proposals to facilitate urban renewal, including those relating to strata scheme terminations, with input from all interested State Government agencies, non-government organisations and members of the public, with the objective that all persons who are unhoused by urban renewal should have access to affordable, secure alternative housing in the location of their choice.

Help save your EDO

The EDO NSW (Environmental Defenders Office) is, like the Tenants' Union, a community legal centre.

They're the experts in environmental law, and in the course of their work giving legal information and advice to interested members of the community, they've ruffled the feathers of some powerful interests. Their funding is under pressure – funds and funding timeframes have already been cut – and if things don't change, the EDO will have to lay off most staff and cut most of their services in the New Year.

The EDO needs a commitment from the NSW State Government to its ongoing funding. You can help – the EDO's call for help, with further details of the current crisis and how best to solve it, is reproduced below.

Will you help us to save your EDO?
After nearly 30 years of helping the people of NSW to protect their environment and heritage under the law, EDO NSW faces an unprecedented threat to its survival and we need your help to ensure we can continue to assist you in public interest environmental matters. Please read on to better understand the problem and what you can do to help.

POLITICAL PRESSURE
In recent days, the NSW Energy Minister attacked EDO NSW’s involvement in last weekend’s community conference in Gloucester. The conference provided an opportunity for community members to obtain information on developments across NSW and was attended by farmers, elected representatives and the broader community. This latest comment follows months of repeated attacks in The Australian newspaper, the National Civic Council and in NSW Parliament, mainly by Shooters and Fishers Party MPs. These are unjustified attacks on our work as lawyers for the environment.  Click here to see our letter of October 19th 2012 to NSW Government Ministers and MPs responding to these attacks.

FUNDING CRISIS
The NSW Government is now being urged to stop EDO NSW funding under a review of legal assistance services. At the same time, the major source of our annual funding - which comes from the Public Purpose Fund of the Law Society of NSW (PPF) - has been cut. We have been receiving PPF funding since 1996, normally under three-year grant agreements, and our work has been actively supported by the Trustees. The first cut was to 6 months (July-December 2012); and as of this month has been reduced to only 3 months (January-March 2013), with the dollar value cut by a quarter.  As a result, both our PPF funding, and NSW Government funding, must now be considered at risk.

THE PROBLEM
This damaging uncertainty makes it extremely difficult, if not impossible, to maintain a strong, independent EDO, that can offer ongoing help to clients, and serve the wider community, while operating free of the politics of the day. If our PPF funding is not restored and public funding affirmed then EDO NSW as you know it will be decimated if not destroyed in the New Year. This is occurring at the same time as the Government is pursuing its signature reform of the planning laws, with the avowed intention of restoring community participation and public confidence after the dark days of fast-tracking major projects under Part 3A.

THE SOLUTION
The uncertainty can be solved by the NSW Government making clear its strong and unambiguous support for ongoing PPF and public funding of EDO NSW, ideally with cross-party agreement in the Parliament. In this way, community participation and public confidence in the planning and environment system can be maintained.

WHAT YOU CAN DO
We need our many supporters to speak up long and loud. Please do any or all of the following:  Contact your local Member of Parliament to call for their support to save EDO NSW, and to express your support. You can find contacts for your local MP at http://www.parliament.nsw.gov.au/prod/parlment/members.nsf/V3Home

• Contact the Premier office@premier.nsw.gov.au or ph: (02) 9487 8588), the Attorney General the Hon. Greg Smith office@smith.minister.nsw.gov.au or ph: (02) 9228 5246) and the Minister for Planning & Infrastructure the Hon. Brad Hazzard MP office@hazzard.minister.nsw.gov.au or ph: (02) 9228 5258)
• Speak to your local media and look for opportunities to support us such as calling in to radio talkback
• Share this email with anyone you think might care about EDO NSW.
• We also welcome your donations to EDO NSW  

OUR FUTURE
If the current situation goes unchanged, it means we will have to lay off most of our valuable, highly professional and tireless staff early in the New Year, and begin dramatically scaling back or shutting down our popular key community services including: 

• Free legal advice telephone line – we took nearly 1500 calls last year
•  Community workshops – 95 across NSW in the past three years, with about 95% in rural and regional areas
•  Rural and regional work – a major focus for the past 10 years, with a regional office in Lismore, and support to communities on key issues like native vegetation, water plans, coal seam gas, mining, private conservation and local planning
•  Indigenous program – unique support to the Aboriginal community on culture and heritage
•  Education and publishing – major guides/handbooks, and 40 much-used Fact Sheets, and a major new guide on mining set to be published
•  Policy and law reform – including extensive input to the current major reform of the NSW planning laws, with 2400 hits on our online guide to the Green Paper during the submission period
•  Court cases and mediation – ensuring high quality cases get heard and those with poor prospects are filtered out, which has led to many important environment cases on behalf of communities from the cities to the bush  
• If NSW loses its EDO, the community’s only source of accessible, independent, expert, public interest legal advice on planning and environment matters since 1985 will disappear.

If that alarms you, then please take a stand. Help us to save your EDO.

NSW State Govt dumps affordable housing policy

Reported in today's Herald:

THE Planning Minister, Brad Hazzard, has called an immediate halt to new development applications made under a controversial policy designed to boost affordable housing for low- and middle-income-earners, and announced amendments to the scheme while a new policy is developed.

We understand the 'controversial' policy to be the Affordable Rental Housing State Environmental Planning Policy (ARHSEPP) - or, at least, those aspects of the ARHSEPP that deal with 'infill affordable rental housing'.




(There's no word in the report or, as yet, on Planning NSW's website as to whether other aspects of the ARHSEPP, such as those dealing with boarding houses, supportive accommodation, or developer contributions to compensate for the loss of affordable housing, have been changed.)

The Herald quotes Minister Hazzard as saying the infill affordable rental housing provision gave ''an avenue for small-time developers to rip into local communities and change [their] entire face''.

We submit that unaffordable housing also rips into local communities, by forcing essential workers like nurses, police officers and teachers to live far away from their places of work, and by forcing out residents who might have deep roots in a community, but not deep pockets.

The Tenants' Union supports the ARHSEPP, but with some pretty heavy reservations. It doesn't - and to be fair, couldn't - address the primary causes of unaffordable housing, which lie in the tax system, rather than the planning system. (It's not as if housing is unaffordable because low-income renters have been too greedy as to the standards required of their bedsits).

But even on its own terms, the ARHSEPP is a policy instrument of marginal usefulness. This is because its approach is basically permissive: it allows certain things to be done that, under the usual rules applied to developments, wouldn't otherwise be allowed to be done, provided they're done to provide affordable rental housing. It doesn't require or mandate that anyone do anything about affordable housing.

If the State Government will not pursue the provision of affordable housing outside the usual rules for developments, it's going to have to do so within the rules. That means mandating substantial quotas of affordable housing for major developments, and requiring all local councils to plan for affordable housing.