Minute with Magnus

Magnus-whitespace_addedIt’s busy days! Here are some things that I’ve been doing and thinking about, mostly housing related.

  • I dropped in for a day at the Powerhousing Conference and was challenged by the obvious flow-on effect that the booming markets in Sydney and Melbourne have had on Hobart, now the least affordable in Australia if measured by income. With down-sizers, investors and AirBnBers snapping up Hobart properties, this has quickly pushed many of the locals out of the market and has seen a rapidly escalating problem of homelessness.
  • It’s now less than 2 years before we see the first of the 38,000 NRAS (National Rental Affordability Scheme) properties lost to the affordable housing sector. This scheme lasts for the first 10 years only of these properties’ lives. No scheme exists to replace any of these properties nor to build new ones at any meaningful scale, so the affordability crisis will likely continue to escalate. Three steps forward … 4 steps back …
  • I’ve taken a week off to paint my own ‘affordable housing’ – a secondary dwelling or granny flat for my daughter and son-in-law. Where else can you get a small house in Sydney for $150k? But why did the DA complete with 80-page flora and fauna report (in Parramatta LGA!!), transport plans and waste management plans take two years and about $20,000 before we even started to build? We appear to have the same process for a 55m2 granny flat as we do for a 10-storey unit block, but why?
  • I’m enjoying being part of the Parramatta Affordable Housing Action Team, one of 11 such teams established across Sydney to advocate for affordable housing and for civil society to work with local councils and state MPs. This is a strategic partnership between the Sydney Alliance and Vinnies. Please contact me or the Sydney Alliance if you wish to know more and to find your own local team.
  • In the midst of my busy-ness I’ve been taking my own mental health pills in the form of marathon training – aiming for the Blackmore’s Sydney Marathon on Sunday, 16 September. How do you stay sane in the midst of your busyness?

All’s not well in the gardens of Eden

Regional areas, particularly up and down the east coast, are reeling under the shockwaves from the Sydney and Melbourne property booms. Coffs Harbour, Port Macquarie and the Tweed have all seen affordability and supply issues soar. Churches Housing’s CEO, Magnus Linder, has just returned from Eden where the Salvos, Uniting and Anglican churches are all crying out for more crisis, transition, social and affordable housing. They are prepared to throw some land (pictured) at the problem but, of course, there are many hurdles before anything can be built to alleviate what are escalating housing problems for many communities. Treating housing purely as an asset class has led to market failure for many people who simply need housing as shelter.

Churches Housing AGM 2018

Image: Brett HemmingsLachlan’s in Old Government House, Parramatta Park, is the venue for Churches Housing’s annual general meeting.

We’d love you to join us for a light breakfast and reports on the year past and our plans for next year, so reserve your place now.

Transport: public transport, via Parramatta bus and train interchange is a 10-15 minute and car parking is available inside the park. See http://lachlans.com.au/map-weekday/

Event: Churches Housing annual general meeting

Venue: Lachlan’s at Old Government House, Parramatta Park, enter via Pitt St, Parramatta

Date: Fri 19th October

Time: 9.30am-11am

Cost: no charge

Bookings: essential – contact Philippa Yelland

The future matters for children and families

04 pic Their Futures MatterCo-ordinated services for vulnerable children and families are the goal for Their Futures Matter, a NSW reform body aiming for a whole-of-government approach to better outcomes.

Churches Housing is working with TFM to emphasise the crucial importance of safe, secure housing for families at risk.

Executive director Gary Groves is driving the reform in various departments: Education, Family and Community Services, Ministry of Health, Justice, Premier and Cabinet and Treasury.

Groves and his team are also working with peak bodies, such as Churches Housing, and service providers to provide a better co-ordinated solution for families.

Photo: Gary Groves, executive director, and Than O’Brien, director, Their Futures Matter

Housing actions coming to your area soon

06 pic housing action RydeWith the stroke of a pen, hundreds of affordable, secure dwellings could be built across Sydney.
We’re inviting you to participate in local assemblies across Sydney to win on affordable housing.
These assemblies and forums are being hosted by Sydney Alliance and Vinnies NSW.
Before the next State election, two things are needed:
1. NSW MPs commit to enabling policy on affordable and secure housing
2. Councils commit to actually building affordable housing.
The first assembly is planned: Come to the first one to see how it is done!
Right to Home Community Forum
Ryde-Eastwood Leagues Club, 7pm-8.30pm, Monday 24 September 2018
Decision makers: NSW MP Victor Dominello and Ryde Mayor, Jerome Laxale

Penrith spoke – now it’s Parramatta’s turn!

In mid-September, Churches Housing – as part of the Sydney Alliance – will be partnering with Macquarie University’s Department of Sociology to survey the Parramatta LGA on housing affordability. Up to 25 students will be trained as interviewers for both the pilot and main survey projects.
Students will use the survey’s results in their studies and these results will also provide further evidence of the need for affordable housing in Sydney.
Professor Justine Lloyd, who is heading the university team, is excited about the project and expects it to be a terrific experience for her students.
The questions from the Penrith survey will be re-used and then the results will be analysed by Churches Housing. As with the Penrith survey, the survey will be done using mobile phones and iPads which connect to Churches Housing’s purpose-built online survey system.
The pilot is scheduled for Friday, 14 September.

Doug Cameron’s Speech to Ahuri Mentions Penrith Speaks!

SPEECH TO THE AUSTRALIAN HOUSING AND URBAN RESEARCH INSTITUTE
AFFORDABLE HOUSING SUPPLY SOLUTIONS CONFERENCE

SENATOR THE HON DOUG CAMERON
SHADOW MINISTER FOR HOUSING AND HOMELESSNESS
SHADOW MINISTER FOR SKILLS, TAFE AND APPRENTICESHIPS
SENATOR FOR NEW SOUTH WALES

SPEECH TO THE AUSTRALIAN HOUSING AND URBAN RESEARCH INSTITUTE

AFFORDABLE HOUSING SUPPLY SOLUTIONS CONFERENCE

THE CANBERRA REX HOTEL

TUESDAY, 29 MAY 2018

I acknowledge the traditional owners of the land and pay my respects to their elders past and present.

I also acknowledge the invaluable work being done by AHURI on housing and homelessness research.

Last Saturday morning, I attended a Uniting Church Community Housing Forum in Penrith, Western Sydney.

The forum was organised by the Uniting Church and the Sydney Alliance Coalition of more than 40 not-for-profit community, educational and union organisations.

Presentations on housing and homelessness were given by community organisations, Penrith Council, academics and political parties, unfortunately no one from the Coalition attended.

A report was given on the results of 628 face-to-face conversations on March 17, 2018 with Penrith residents and visitors.

131 volunteers conducted sampling by doorknocking selected interview areas throughout Penrith local government area including walk up interviews, sporting fields, shopping centres and market stalls.

Age distribution of the sample closely resembles that of the ABS 2016 Census for the Penrith LGA for people aged 18 and over. The key results were as follows:

  • 82% are concerned about the lack of affordable rental housing in Western Sydney
  • 97% agreed everyone has a right to affordable rental housing
  • 98% agreed everyone has a right to secure housing
  • 70% disagree that it is easy for low income people to find rental housing
  • 87% say new housing developments in Western Sydney should include units that lower income people can afford to rent
  • 82% disagree that landlord should be able to evict tenants  without giving any good reason
  • 72% disagree that the New South Wales Liberal government is doing enough to make housing more affordable

Affordability, housing security, the need for more rental accommodation, and concern that the political class are not doing enough on housing affordability would, in my view, be replicated across the country.

Contributions from the floor of the forum identified the lack of public transport, lengthy commutes to jobs and concerns that young people in Western Sydney are being locked out of the housing market.

None of this would be alien to those attending this conference and these results could be replicated nationwide.

The 2016 census statistics are very concerning:

  • There were 116,427 people enumerated in the census who are classified as being homeless on census night.
  • The homeless rate rose by 27% in New South Wales, while Western Australia fell 11% and Northern Territory and Australian Capital Territory each fell by 17%.
  • Most of the increase in homelessness between 2011 and 2016 was reflected in persons living in “severely “crowded dwellings.
  • Homeless youth (aged 12 to 24 years) made up 32% of total homeless persons living in “severely” crowded dwellings.
  • The number of homeless persons age 55 years and above has steadily increased over the past three censuses.

An Anglicare survey shows that less than 1% of homes for rent in greater Sydney are affordable for households on low incomes. In most of our capital cities, rental vacancy rates are below 2%.

While housing construction activity in 2016 and 2017 kept pace with population growth, this did not dampen pent-up demand generated by years of under building in the affordable housing sector.

Housing affordability continues to be a significant problem.

As Professor Duncan McLennan has said, housing is one of the largest contributors to intergenerational inequality.

Young Australians are finding it almost impossible to access the housing market. Many young Australians will spend most of their lives in the private rental sector.

The International Monetary Fund found Australia has one of the highest house price to income ratio in the world.

Prior to the 2017 budget Minister Sukkar told Sky News:

“The housing package will be extraordinarily large, it will be far-reaching, it will deal with all the groups, on the spectrum of housing….It will be an impressive package; it will be a well-received package”

Well Minister, you got it wrong.

John Daly from the Grattan Institute said:

“You’ll need a scanning electron microscope to see an impact on prices”

I can’t see any reason why this budget is going to make a discernible difference to housing affordability; a discernible difference on the number of younger people that buy a house” (ABC 7:30 Report, 10 May 2017)

Adrian Pisarski from National Shelter:

“It’s a centrepiece without a centrepiece” (ABC News 24, 9 May 2017)

Homelessness Australia:

“The budget fails to deliver the big picture solutions needed to end homelessness”

“This budget is not fair because it fails to fix a broken housing system that encourages investors to own more than one house while 105,000 have no home at all”

James Toomey, Mission Australia:

“Disappointingly, the budget contains inadequate assistance for the many people in rental stress who remain just one step away from homelessness”

Richard Holden, Professor of Economics, University of New South Wales

“Yet the measures in this budget involve not much more than tinkering”

“But the biggest minus of all was the absence of any measure whatsoever to address negative gearing and capital gains tax exemptions for rental properties” (the Conversation, 9 May 2017)

First home buyer, Bree Marr, commenting on the salary sacrifice superannuation measure said:

“It wouldn’t even cover your stamp duty” (ABC 7:30, 10 May 2017)

This so-called extra ordinary large, far-reaching, housing package didn’t exactly knock the socks of community organisations, academics, or younger people trying to buy their first home.

When young people are lining up against housing investors in an attempt to buy their first home, it’s outrageous that investors are using government tax concessions to outbid them and leave their dreams shattered.

A housing package that fails to deal with negative gearing and capital gains tax exemptions is an ineffectual and inferior package.

It was reported last week that a number of Liberal politicians, including the Michaelia Cash, have penned essays eulogising Bob Menzies’ “forgotten people” speech.

I also note the former treasurer Peter Costello has described Australians who earn $200,000 as the “forgotten people”.

I have never been a fan of Peter Costello, a weak Treasurer who stood by while John Howard baked in an unsustainable structural deficit as a result of attempting to buy the votes of middle-class and wealthy Australians. We are still paying the price for this economic incompetence today.

Under Peter Costello the Coalition government showered financial largess on middle-class and wealthy Australians.

The real forgotten people in this country are indigenous Australians who have had government support in housing and health ripped away as part of the government’s unfair austerity programs.

The real forgotten people in this country are working-class households in rental and mortgage stress.

The real forgotten people in this country are the low income families who have lost their penalty rates and are struggling to put food on the table for their kids.

The real forgotten people are the young Australians who will never own their own home and will be hostage to a rental housing market that is not fit for purpose.

In his forgotten people speech, Menzies positioned home ownership as the basis of a stable society. He said:

“The home is the foundation of sanity and sobriety; it is the indispensable condition of continuity; its health determines the health of a society as a whole”.

He certainly did not think the rich and powerful needed a leg up. He said of them in the forgotten people speech:

“In most material difficulties, the rich can look after themselves”

So much for Peter Costello’s positioning of Australians earning $200,000 as the “forgotten people”.

The Prime Minister in his insensitive and arrogant comments to John Faine that he should just “shell out” and provide a bit of intergenerational equity in the Faine family so that his kids could enter the housing market shows how out of touch this Prime Minister and his government is.

Former treasurer Joe Hockey, who introduced the concept of “lifters and leaners” in his disastrous 2014-15 budget advised prospective homebuyers to get “a good job that pays good money, if you want to enter the property market”.

Not bad for a politician who retired in financial security due to the now-defunct and generous defined benefit superannuation scheme and moved seamlessly to enhance his retirement benefits with a stint as ambassador to the USA!

Coalition politicians are divorced from reality and the struggles of working-class Australians.

It’s over 12 months since the 2017 budget decision to establish a Bond aggregator through the National Housing Finance and Investment Corporation Bill 2018.

The Treasury Laws Amendment (National Housing and Homelessness Agreement) legislation has been passed however not one state government has signed on.

I expect that some state governments will sign off eventually, even though they are concerned with aspects of the NHHA.

Labor recognises the inequities in our taxation and housing systems.

Budgets and taxation are a demonstration of the priorities of a government.

Labor believes there are many priorities in housing, homelessness, health, education and infrastructure that should be addressed prior to costing the budget $80 billion to cut business tax for multinational corporations and giving $17 billion of tax relief to the banking sector.

Trickle-down economics does not work and this is a desperation tactic from a deflated, despondent and rudderless government.

This government’s economic “plans” have ranged from austerity budgets, increasing the GST, handing tax powers to the states and now trickle-down economics.

In contrast the Shorten opposition is united and focused on developing policies that balance the economic imperatives of the nation with the social needs of the community.

When last in government we took the following initiatives towards addressing housing affordability and homelessness:

  • We produced the Road Home White Paper on Housing and homelessness and developed national strategies and targets to reduce homelessness.
  • We committed to the Housing Help for Seniors Pilot.
  • We invested $5.6 billion in the Social Housing Initiative which delivered around 20,000 new homes, funded repairs and maintenance to 80,000 more and supported 90,000 jobs through the global financial crisis.
  • We provided $6 billion to the states and territories for affordable housing.
  • We negotiated the National Partnership on Homelessness which provided the state and territory governments with over $1 billion for reducing homelessness
  • We established the National Rental Affordability Scheme which has provided 30,000 new affordable rental housing units. The NRAS was on track to deliver 50,000 new affordable rental dwellings and the level of demand was such that it could have been extended by a further 35,000 dwellings.
  • We established the National Housing Supply Council.
  • We appointed a dedicated Minister for Housing and Homelessness.

In opposition we have announced:

  • Reform to negative gearing and capital gains tax concessions;
  • The facilitation of a COAG process to introduce a uniform vacant property tax across all major cities;
  • Limiting direct borrowing by self-managed superannuation funds as recommended by the 2014 financial systems inquiry;
  • Increased foreign investor fees and penalties;
  • The establishment of a Bond aggregator to increase investment in affordable housing;
  • Boosting homelessness support for vulnerable Australians;
  • Committed to achieving better results from the National housing and homelessness agreement;
  • Re-establishing the National Housing Supply Council; and
  • Appointing a Minister for Housing and Homelessness.

Labor’s package would see the construction of over 55,000 new homes over three years, and boost employment by 25,000 new jobs per year.

Since this announcement, Shadow Treasurer Chris Bowen has announced two major tax initiatives in addition to our previously announced tax policy;

  • The removal of imputation credit refunds and
  • The introduction of an Australian investment guarantee (a form of accelerated depreciation)

As Chris Bowen said on March 5, 2018:

“An important part of any sensible fiscal strategy is identifying those tax concessions which eat away at the revenue base and reform them or abolish them in order to underpin budget repair and the funding of new initiatives”

The difficult taxation decisions that we have made will allow Labor to do more on social issues such as housing.

Labor has indicated that will have more to say on Housing and Homelessness policy.

We have conducted a number of Housing and Homelessness forums across the country.

We have engaged and consulted with faith-based groups in relation to assessing and accessing church land for low income housing. Labor believes that we can reach mutually beneficial agreements with church groups that provide increased housing stock and reliable income streams to religious organisations.

We have had a number of roundtables with industry superannuation funds designed to increase institutional investment in community housing.

This can be done while meeting the obligations of the sole purpose test.  Government has a role beyond the Bond Aggregator to ensure that lower income individuals and families can benefit from institutional investment in community housing.

Government can play a role with superannuation funds by working towards developing a risk-adjusted rate of return on affordable housing that encourages institutional investment.

This would improve outcomes and ensure industry fund members achieve a comfortable retirement with the superannuation funds helping deliver economic and social outcomes which maximise long-term retirement benefits.

The growing trend of workers retiring while still paying off a mortgage results in superannuation savings being used to pay the mortgage off. This diminishes the capacity for individuals to retire securely outside the government pension system.

Australian industry superannuation funds already invest in social housing in the US and UK and it is time government, the community housing sector and the superannuation funds work together to increase superannuation fund investment in low income housing stock for the benefit of fund members.

A government guaranteed asset class in community housing can deliver long-term stable returns to the funds with benefits to individual fund members and the community.

There is a growing recognition that failure to meet the challenge of housing and homelessness will result in increased intergenerational inequality, growing social unrest; increase in cost to government through the health and justice systems.

The Commonwealth cannot continue to blame state and territory governments and local councils for lack of supply of suitable and affordable housing.

A concerted effort to develop a national housing strategy that includes all levels of government, business, the finance sector and the superannuation industry is fundamental to addressing what for many are the unsurmountable challenges in accessing an affordable roof over their head.

All options should be on the table including inclusionary zoning, build to rent, shared ownership and increased rights for tenants.

Labor shares the concerns of excluding build to rent from managed investment trusts as there is a need to increase housing stock across the continuum.

If we are serious about increasing housing supply, improving productivity and helping the disadvantaged in our community, then the Government must address the funding gap that still exists following the introduction of a bond aggregator.

Even Coalition Senators on the bond aggregator inquiry noted the submissions from the community housing sector on the need to fund the gap.

Labor will continue to develop our policies and priorities, however we do not believe an $80 billion handout to overseas corporations, big business and banks should be prioritised over the need to address affordable housing supply.

 

Authorised Noah Carroll, ALP Canberra

 

Negative gearing – some home-truths behind the figures

People in wealthier occupations are much more likely to use negative-gearing, according to Greg Jericho, writing in The Guardian.

When the annual taxation statistics were published in late April, the general media crowed that most negative gearers earned below $80,000.

However, Jericho writes, ‘of the nearly 400,000 people who are chief executives, executives or general managers, 18% claimed a rental loss, compared with 13% of the just over 700,000 school teachers, midwives and nurses.

‘Anaesthetists and surgeons – the two occupations with the highest median incomes, love to negative gear – 30% of anaesthetists, and 29% of surgeons do so.

‘And over the past four years, the big growth in negative gearing has been by those owning multiple properties’.

https://www.theguardian.com/commentisfree/2018/apr/29/so-most-negative-gearers-earn-below-80000-well-heres-the-catch

The chart – courtesy ABC.net.au – shows that the proportion of negative gearers is highest among two groups: medical practitioners and air/marine transport professionals.

http://www.abc.net.au/news/2018-05-02/chart-of-the-day-proportion-of-people-using-negative-gearing/9718618

Courtesy abc.net.au

New FACS website is now live

FACS’ new website is now live. Design is more mobile-friendly design, navigation is better and information is easier to find. The design and build of the new site is user-centric, with users and NGO Peaks (and their member organisations) being consulted.

New FACS website pic

The new site www.facs.nsw.gov.au replaces 10 existing FACS sites. The decommissioned sites are:

1 Family and Community Services (Old site) www.facs.nsw.gov.au
2 Community Services www.community.nsw.gov.au
3 Housing NSW www.housing.nsw.gov.au
4 Centre for Affordable Housing www.housing.nsw.gov.au/Centre+for+Affordable+Housing/
5 Community and Private Market Housing Directorate www.housing.nsw.gov.au/Community+Housing+Division/
6 Housing Pathways http://www.housingpathways.nsw.gov.au/
7 Future Directions http://www.socialhousing.nsw.gov.au/
8 Fostering our Future http://www.community.nsw.gov.au/fostering-our-future
9 Disability Council NSW http://www.disabilitycouncil.nsw.gov.au/
10 Ministerial Advisory Committee on Ageing www.maca.nsw.gov.au

The new site has a dedicated section for funded service providers. A dedicated page about peak organisations is also being built. FACS invites feedback on the new site, either from each individual page or to Contracting.SectorDevelopment@facs.nsw.gov.au.

www.facs.nsw.gov.au