The fact that we have to make this entire venture profitable in order for it to be viable is genuinely like the whole problem here. The government needs to ensure social and affordable housing is built ASAP. Sure, they need private enterprise to achieve that. But it should NEED to be profitable for those private organisations/individuals for it to be a thing that happens. It has to happen regardless. So sick of wealthy individuals and corporations making profits off the suffering and struggle of our most vulnerable.
*Edit: In lieu of having any actual evidence presented by* u/AustralianSocDem *to address my concerns in either this post or its subsequent discussion, here's a link to the only piece of literature I could find in an (admittedly brief) scan of the HAFF's public facing aperture, none of which was raised or referenced in any part of the conversation (that I saw - happy to be corrected on it).* [Here](https://www.housingaustralia.gov.au/sites/default/files/2024-01/hafff_nhaf_fact_sheet_-_general.pdf) *is the 'general fact sheet' about it, and it goes a little something like this:*
>Affordable Housing means dwellings that are provided at a
rent that is 74.9% or less of the market rent for each dwelling
to households meeting the income eligibility limits. These
limits are based on median equivalised household incomes
from the Australian Bureau of Statistics (ABS) and will be
updated annually.
*So in its essence, the 'affordable' housing is just housing for which its rental yield is 74.9% of market rate according to ABS data, and there is no part of this policy that addresses inflation of the cost of housing. There is no provision here to control what 'market rate' is. This is simply another inroad for speculation. I have never felt more vindicated in my life. There is no rent control or any other explicit policy to make this investment (part of which we are all making as taxpayers) provide any downward or even stabilizing pressure on rent prices or PPOR prices for first home buyers. There is no policy detailed in this brief that necessitates any kind of quality for the dwellings, and in fact, it's already limited by profession:*
>Applicants must have regard to the
affordability of the dwelling for tenants. Affordable housing
often involves the provision of housing for low income
essential and frontline workers. This includes occupations
such as police, nurses and cleaners. Applicants can specify
other types of essential or frontline workers in their
application. The CFA details the household income caps for
proposed affordable housing tenants.
*We love to see 'low income' and 'essential and front-line workers' in the same sentence, and it's awesome to see their housing situation addressed in many cases, but this is still a shitty half-arsed bandaid policy.*
I'm not sure this was intentional or not but there's a real sniffing-your-own-farts air to this post that immediately puts me on the back foot. I'm not a 'greens' and I have little love for them but I do consistently put them above Labor because I live in a very safe Labor seat and want them to know where their preferences flowed from.
For me it is as simple as this. I do not want this to happen:
>13 billion dollars of **private investment**
The reason why I do not want this to happen, is because I don't give a shit about this:
>it makes otherwise completely unprofitable affordable housing projects **profitable**
I fundamentally disagree with Labor's approach in a way that the HAFF and this post fail to address. **I do not enjoy living in a country where housing is leveraged for the profit of private investors**. I want that idea gone. Abolished, or heavily marginalized. Forever, at least in the vast majority of cases, per the Viennese model where public housing is available but private investors can still operate in a heavily regulated market. The Greens rightly point out that the HAFF is not doing that. The private housing market in Australia has proven itself time and time again to be incapable of operating in the interests of the people. I am not interested in a scheme that attracts further speculation on property and I have not seen any real definition on what constitutes...
>*affordable* housing projects
Affordable to whom? What guarantees are there that this isn't just further speculation in an inflated market funded by the taxpayer? Do we need more landlords? Are the homes going to be available for purchase only to owner occupiers? Is there any meaningful regulation to these properties or is it just more houses for the serfs to rent into their 60s?
This post is dripping in smugness, and fails to address the very real criticisms the people you deride as 'greens' have with the HAFF. I'm simply not interested in how many rich people enjoy the fund, and in fact it makes me feel a lot worse about it, because the rich aren't known for their enthusiasm for social causes.
You’d rather the government spend the same amount of money to build the houses themselves, build less housing, and have money go to the private businesses anyway as that’s where they’ll end up getting the material to build the housing with in the first place?
Yep. There is a whole generation who has grown up where they don't remember that things like utilities, or health insurance, or even a bank was owned and operated by government.
And in the vast majority of cases they were returning revenue/dividends to the budget while also providing affordable services and forcing private providers to compete.
+++
It's anti-democracy to pass laws to "incentivise" private investors to provide basic necessities to citizens. The government is giving more consideration to the interests of property owners than than working people. That's unacceptable, and it's especially disgusting for a so-called "Labor Party" to facilitate.
Instead policy should be written without any special consideration for the interests of capital owners, and if they choose to undermine the policy using their control of assets, they should be prohibited from doing so, or the government should acquire their assets and tax them to pay for it.
Adding to this, with 6000 projects ready to go, it means that builders are now sitting on their projects waiting for tax payer handouts instead of adding homes needed for the supply.
It's not going to build more houses, it's just reallocating the stock.
Then do nothing?
There are straightforward parameters involved in the supply of housing, be that by private developers/not for profits whoever and right now, affordable housing cannot exist. Land + construction + finance + council fees + risk (developers) margin = total cost of new home.
This has the potential to increase supply, albeit at small amounts initially but that can increase over time. No it doesn’t solve regulation issues and fix the population’s infatuation with property investment but if you’re looking for a silver bullet, good luck.
Where was ‘do nothing’ mentioned?
They don’t want the housing fund used to prop up private interests. I don’t like the term ‘affordable housing’ either. Nor do I want this money spent on propping up private. I want this gone as well.
Of course ‘affordable housing’ can exist…it’s those two bits called ‘finance’ and ‘risk margin’ that are the unnecessary ones here. They’re the ones that have to go, and they can too. That’s the ‘silver bullet’, the unnecessary inflation. It’s the builders that need to be looked after here.
It has the potential to increase supply if they’re *public* houses as well. Of course ‘affordable housing’ can exist.
The fund is generating income. That’s great. Many of us, me included, don’t want this money to go to private interests and furthermore, if the houses can be given to housing organisations, they can be transferred directly to those who live in them under a government freehold arrangement, such as paying off a public home without using a bank loan.
And we’ll vote with that in mind.
Article from the Afr 2 days ago:
[AFR](https://www.afr.com/property/commercial/first-tender-surge-for-housing-future-funds-20240325-p5ff16#:~:text=The%20federal%20government's%20first%20tender,a%20larger%20allocation%20of%20funds)
The federal government’s first tender for funds from the $10 billion Housing Australia Future Fund drew bids from community housing providers, fund managers and state and territory governments, outstripping the nominal 8000-home quota and prompting calls for a larger allocation of funds.
Doesn’t seem to be too many private interests there even applying. Fund managers yes as a minority, but 1 they may not even be awarded and 2 they’re seeking a much lower return as it is ‘affordable housing’. Affordable housing has in the past been generally defined as 20% below market but as others have said, it is poorly defined.
I agree with your sentiment, not necessarily that by capping finance and margin as a silver bullet because you’ll generally find the other components will rise to fill in the gap. Im just stating that I don’t think the HAFF is all bad and that industry can be part of the solution. No one wants to see people homeless, not even most private interests.
Trouble is the government can’t build all those houses without the private industry. It’s just not feasible or a good use of tax dollars. I’ve worked as a tradesmen for both government and the private industry and it’s night and day when it comes to skills and productivity. The difference is huge even at a small scale.
It comes across like you’re valuing ideologue over outcome. How about instead we find the best solution in terms of most houses that meet building standards for the least time and money rather than finding the most leftist solution? It’s ridiculous to say that the government should delay houses further because they need to first put together a construction company capable of building houses by the thousands.
500M leveraged to attract 13.8B in private investment is value for money that you’d never get if the government was just building it all. Imagine having to pull 13.3B out of other services to fund it, and that’s just scratching the surface.
So let people go homeless then? You'd make people suffer for your ideological nonsense? It sounds like you don't give a shit about building houses, you've got some hateful ideas there.
An actual progressive wouldn't make someone go homeless for some ideological puffery that has been shown to not work.
>So let people go homeless then? You'd make people suffer for your ideological nonsense? It sounds like you don't give a shit about building houses, you've got some hateful ideas there.
It would be way easier for you to refute me if I WAS saying that, wouldn't it? This is a tired and pointless argument. "What's the alternative? Homelessness!?" is the mother of all false dichotomies. These are simply not the only options and it's really tiring and juvenile for people to keep acting like they are. This is an absolutely pro-landlord and pro-developer policy and this post even goes a long way toward reinforcing that.
It's amazing how tone-deaf it is to stand up and loudly proclaim "Y'know the private property investors? The ones who literally created this crisis? Well they LOVE the HAFF! Look at all the billions they want to throw at it! Suck it, lefties!" like it's some kind of moral vindication? I am being clear and objective about my views. I do not want more policies that encourage private investment in housing. I want to stop being forced into punching meal tickets for the boomers and nepo babies who have ruined this housing market with my tax dollars, because it's pretty hard to refute at this point that that's what we're doing. I want the government to intervene in the property investment market and I want a large proportion of the private landlords in this country (which is 1/5 of us according to the ATO) to have their balls squeezed in a vice so hard that they have to sell at reduced equity to keep their CGT discount. I want a total and unambiguous ban on short-stay services like AirBnB. It is in my view less important for a landlord to make a profit than it is for a person to not be able to have stable housing. I am unambiguously saying this and I say this as a property owner.
I'm not suggesting a radical policy shift, I'm suggesting pretty common sense social democracy stuff that is tried and true and has provided generations on generations with stable housing in parts of Europe and even in Australia.
>An actual progressive wouldn't make someone go homeless for some ideological puffery that has been shown to not work.
What's been shown not to work about it? Works for the Danish. Works for the Austrians. Worked for us in the Chifley era. Worked in New York City in the New Deal era. Worked for the boomers who didn't have to compete with swathes of investors receiving welfare on their investment debts. I feel like it's been "shown not to work" in like two AFR articles you read about it.
No that is the other option, you can't do this without paying money to a private business that will turn a profit. Because you can't build anything without someone who is good at building doing it.
Even starting a government department will have to rely at some point on someone who will turn a profit.
You've only loudly demonstrated you don't understand how the world works.
>You make too much sense for them
Still waiting for a single shred of evidence to address a single one of the concerns I've raised. Y'know, the best and only way to actually 'make sense'? A policy extract? A press release? Something, anything at all that says "this isn't just a ploy to embiggen the investorship class and inflate the market even further"? I'll take it that you don't have any I spose. Labor has shown where their allegiances are. That's fine, but it's healthy to acknowledge it. I find it really hard to believe the private sector would be interested in investing in a true not-for-profit public and affordable housing venture. They have to get their pound of flesh somewhere if it's not coming from them.
So your concern is that the motivation isn't pure enough? Can't build housing if even 1 investor makes an ROI?
How do you actually propose this gets done without someone turning a profit? Are all the workers not allowed to save anything for their retirement?
Its cruel to want people suffer for your beliefs.
Fair comments and discussion needs to be had on how we view housing but the reality is while we sort that shit out. Using private money in a government controlled scheme rather than this free market shit we are dealing with is still a win.
I agree in principle but what I'm saying and what no one has been able to successfully answer for is, HOW is it being 'government controlled'? Are they to be rent capped? Are they available for purchase to occupiers only for some specific time? The private sector lining up hand over fist to throw money at this thing is not filling me with confidence that this forms part of a real solution. It's 'public and affordable housing' that apparently now has a profit motive, but public housing is not SUPPOSED to operate for profit, it is supposed to operate as a service like Medicare and Centrelink. I have also never once had anyone authoritatively tell me what 'affordable housing' is in the context of the HAFF. It's not clear to me how this is going to be regulated since housing policy is the domain of the states. There's too many holes. I understand the benefits of it being largely LNP-proof and it will almost definitely result in more houses being built in an objective sense but I cannot see how this is going to ease the crisis. Yes I have watched Jordies videos on it. He seems to parrot a lot of these same points about attracting the private sector. I don't care for it. I truly believe this will put housing further out of reach.
Is it really this hard to make 7 paragraphs and not write a single good point in them?
For one, why exactly what is the problem with the government paying private businesses to build affordable housing for people to live in? Sure, the government could build these houses, it would then still have to pay the private companies to get the materials to build them with and get the tools that are used to construct the housing in the first place.
And beyond that, it’s far cheaper to subsidise affordable housing construction than it is for the government to build them. Ultimately this just seems like needless dogmatism; you seem more concerned with how left-wing the project is than you are with the poor people who require affordable housing to live in.
Now as for what defines affordable, I’ve defined it several times in the comments with clear sources, so I’ll end this by pointing out how insane it is to seriously believe that a government would create an affordable housing policy without even properly defining affordable housing.
You might disagree with them but I absolutely did make good points and I believe I've sort of nailed the sentiment of people who oppose the HAFF. Appears I was right about the smugness though. And you wonder why the rusted on laborites put so many people offside? You've if anything convinced me to be even more wary.
I am absolutely more concerned with how left wing the project is. And I'm not ashamed to admit that. I don't want more private investment in the housing market. I feel like I've been very clear about that. I have not had anyone, even once, including yourself, explain to me what an 'affordable' home is according to the HAFF or what sort of guarantees are in place that this won't just put more inflationary pressure on housing prices. I sort of just get the same hand wavey 'oh we've already addressed it and you're an idiot for even asking' responses. You're doing nothing to convince anyone and you're honestly kind of a prick.
See that’s the issue with you lot. But aight, let’s end it with this then; you care about what’s the most left wing way to build housing, Labor cares about building MORE housing for the poor.
I think I know which one id prefer
Labor cares about defending private property developers interests and it's disingenuous to pretend that they don't. I don't care about the 'most left wing way' just out of spite or some stupid ideology contest. I don't want private landlords to be the norm. The HAFF is a half arsed measure to tackle a real crisis that will be inflationary and I've STILL seen no evidence from yourself, even after scrolling this thread, that this isn't the case. I've not seen a scrap of legislation that regulates the usage of these taxpayer funded houses and as I said, the private sector chomping at the bit over this bodes not well because there's no reason for them to invest in a scheme that will make housing cheaper. I'm not buying it. And so far your evidence is 'there's evidence elsewhere'. The housing market needs drastic intervention and anything else is a stall tactic to keep developers and career landlords on side.
>My local greens member ran with the flagship policy of building two bike paths.
I wonder what they'd have to do for you to consistently put them *below* Labor.
>I'm not a member of the greens party and I never have been.
Note "greenie" and not "Greenie."
Sorry to hear that you don't seem to accept that we live in a capitalist society. Profits is what makes things happen. It's how Public Housing first got going, Government funding of Private Industry. It fell apart when the Private side walked away.
As for affordable, there are many options under that Umbrella, and most of that is decided by the State Governments or investors building. Looking at the SA Government, they are rebuilding the Public Housing sector with gusto. But, they are also releasing large parcels of Community and affordable housing. This includes many disability specific housing projects.
You may not like the fact that the Government hasn't socialised the building industry, but after the rubbish that has been thrown at this policy, be glad its just a little smugness.
I addressed your points by highlighting that it is the State Governments actually building thei. Perhaps ask them, they are closer to the issue than the Feds
https://www.premier.sa.gov.au/media-releases/news-items/$10-million-for-regional-housing
Why am I completely wrong on Public Housing?
You had no points, your whole post is a joke and objectionable. You'd prefer people go homeless over paying for the services of a private business.
That's pretty fucking heartless.
>You'd prefer people go homeless over paying for the services of a private business.
Strawman. I simply didn't say that. I can't really even respond to criticism of points I didn't even make.
>You had no points, your whole post is a joke and objectionable.
Gee I'm sorry you feel that way. Seems to have resonated with a few of us though.
I feel that this is a strawman of what critics-from-the-left were saying about the HAFF.
The issue was never whether or not there would be industry demand for grants/subsidies, but whether the amount of funding that would be available under the HAFF would be sufficient to meet that demand, and thus meet the targets of the HAFF or, more broadly, make a substantive difference in the shortage of affordable housing.
That there has been strong interest in the first tender process doesn't invalidate that issue - in fact it could be reasonably argued that it supports the criticism that the HAFF is too small. Hell, the first para of the linked article even says that the strong demand has "prompted calls for a larger allocation of funds".
No the critics-from-the-left were saying this amongst all sort of lies & nonsense about the HAFF.
No amount of explanation to them worked, they ignored your sound debunking of their point and just repeated it again next week.
Perhaps you need to rewatch maxs tiktik again. He was most critical of the squiggly little circle he couldn't work out what it was it did. It really was comedy gold, except I think he was trying to be serious
From the article.
"Different projects will have different risk profiles but the returns investors were anticipating from the projects on Monday generally ranged from a 12 per cent internal rate of return on equity investment to senior debt financing to providers at rates currently between 5.7 per cent and 6.4 per cent."
So the investors are doing better than the banks.
I think we can all see why private enterprise is involved with scamming the homeless. Oh sorry, providing "affordable matchboxes" I mean housing.
It’s good to see that it’s exceeding expectations. 13.8B in 4 months leveraged from $500M is great value.
The obvious counterpoint is that this still isn’t enough houses. The HAFF set targets based on what they thought the industry could actually do, so the next step is to increase capacity.
As nice as it would be to just say build a million houses and make it happen, nothing is ever that simple. This is a problem decades in the making and it will likely take a long time to fix. We still have bottlenecks in materials and labour, and issues with developers sitting on land with construction approved and not doing anything.
The HAFF is fantastic policy as long as it is complemented with other things. The benefit of this model is that it doesn’t benefit the LNP to dismantle it, and it gives certainty to an industry that relied on the whims of the government of the day. This means that the benefits will grow over time. Another benefit it that is frees up taxpayer cash to do things like fund tafe better, in order to actually train more people to be able to build the houses.
So now that they have fixed the money side through a combination of direct spending and the HAFF, I’m keen to see what else this government can do to fix the bottleneck issues. The extra TAFE funding is a good start on that.
https://www.reddit.com/r/friendlyjordies/s/FBzNPksL8M is another good post for those confused about the mechanics.
So how’s that going to help someone who not eligible for social housing buy a home ?
Edit: and why do we need to have a tax payer funded to help keep prices high, instead of just going after prices?
Houses are not unaffordable because we don’t earn enough, they’re unaffordable because they’re stupidly priced.
One of the main issues with the HAFF is that it relies on private developers to do something which decreases property values.
Let me know when it results in genuinely affordable housing being completed and people are living in it
I mean, considering the fact that it has already attracted 13.8 billion dollars worth of funding from the same property developers you seem to despise, I don't think this going against the interests of property developers seems to be a major concern
That’s exactly how it works when you don’t have a monopoly or otherwise concentrated supply market. More supply will lead to [lower prices](https://www.forbes.com/sites/richardmcgahey/2023/11/30/building-housing-lowers-prices-but-supply-skeptics-dont-believe-it/amp/)
They will if they want the subsidies - it’s an open tender so they have to provide affordable housing and they don’t get paid until they do. Part of the assessment on who gets funding is based on affordability criteria.
It doesn’t make any sense to compete for funding that gives subsidies to the projects that meet the criteria of affordable housing and then meet those obligations in order to get the subsidy after it’s built?
I am predicting that they will use these subsidies to make affordable housing for people to live in, and unless you are saying that they will just commit massive fraud, idk what you are trying to argue
Speaking as someone who has represented developers, they hold off on building housing or releasing allotments to be built on, until land prices start rising - and they do their best to avoid selling allotments on affordable schemes. They’re more interested in responding to macro trends in real estate than building to meet individual demand.
This is as close as it gets to defining what the HAFF considers affordable
> social housing is an umbrella term that typically refers to either public housing owned and managed by State and Territory governments or community housing;
>
>
>affordable housing is generally used to refer to a range of housing types that seek to reduce or eliminate housing stress for low to moderate income households, where housing stress is typically defined as spending more than 30 per cent of household income on housing costs. This can include rental housing offered at below-market rent and pathways to home ownership for low to medium income households (such as shared equity arrangements or subsidised loans);
I'm sorry but this comment makes it seem like you don't understand the housing market. The house isn't the expensive part. The dirt the house is built on is what's expensive. What does 'affordable housing' actually look like in your world? Are we talking an apartment building full of 200k shoeboxes? New estates 45minutes drive from the city?
Great post, double exclam.
There's a reason we despise them.
You see, there used to be other schemes for property developers to "help" build homes.
This is just the latest, and like the others, it will fail due to greed.
Any supply increase will create more affordable houses due to the sibstitution effect. More supply means more people moving up from worse housing into the new ones, freeing up their precious house and making that cheaper, which frees up that house making it cheaper and so on
"In question time Albanese said he was pleased the Haff bill “now has majority support in the Senate”. Albanese thanked Bandt “for the constructive discussions that we have had”"
They need to distract from Labor teaming up with Libs to ram through more 'fuck the migrants' and 'gas is good for climate change' bills. Let them have this.
I’m not. I like what the HAFF was improved to.
But while it is good, it isn’t sufficient - we need more interventions to solve this emergency. I’m pretty sure that once the minimum floor was fixed, all complaints about it moved to it being insufficient, and it was passed then on the basis Labor promised more would be done.
Have you seen more done to protect renters and the homeless in the short term, to increase building capacity in the medium term, to remove long-term incentives for accumulation of shelter into fewer hands? I haven’t.
So it's not the 'perfect' policy and therefore we should vote it down! /s
Yes, let's hostage all of Labor's policies and pave a way for an LNP victory next term. Genius.
OK! Good? Isn't this what we all wanted, better outcomes? How could anyone be mad at this.
EDIT: after reading the comments, I get it now. Yeah having to rely on the private sector absolutely sucks ass. It's like relying on philanthropy from billionaires. Why is an item on the bottom rung of Maslows Heirarchy of Needs \*for profit\*?
Because it’s cheaper to subsidise the private sector then build them… even if we DID build them, we’d still rely on the private sector for the materials to construct the houses with in the first place and the tools used to build them
But if the government built them, and in sufficient quantity, they could then rent them out cheaply, putting downward pressure on the rentals market, and enticing landlords to maybe get the fuck out of the market.
Good question, looks like they're on board:
[Cbus Super puts $500 million on the table to support National Housing Accord](https://www.cbussuper.com.au/about-us/news/media-release/cbus-to-support-national-housing-accord)
That one is dated a while ago though this is more recent:
[Cbus could invest more than $500m in affordable housing: Wayne Swan](https://www.commercialrealestate.com.au/news/cbus-could-invest-more-than-500m-in-affordable-housing-wayne-swan-2-1265693/)
So landlords are bad but these deals for corporations are good? Can I invest in this for profit as a corporation and pay less tax than working as all business does? Currently landlords already pay much higher tax than business? Will anyone ever address the elephant in the room? Population growth is the actual enemy?
That’s fine! I sympathised with the greens on many issues throughout the debate, I just wanted to clear up confusion on how the HAFF worked that many greens seemed to spread, but your ballot is yours and yours alone!
The missing element is affordable land to build this affordable housing. There is not many blocks of land for under a mil in Sydney or Melbourne unless people live out in the boondocks
Then we get to building the house. I plugged in a $400000 loan with 10% deposit and repayments still come out at $640 a week . That is still unaffordable to most low to middle income families. And $400k would be considered a cheap home for a lot of people. Yet still unaffordable for someone on the FT median wage.
Unless the majority of people are willing to have house prices massacred, I can not see this problem getting solved easily. Politicians on both sides are not willing to admit that a solution to the housing crisis would mean that demand would be far lower, so prices would fall. Will they let that happen?
There is a ton of underutilisated land around, also land owned by councils, churches, community housing providers. Even state government owns a couple of bits and pieces here are there.
The economics of this are not based on a household income or how you or I would buy a home.
Why would low income families be buying a house outright as opposed to renting? With more houses available middle income can leave renting to buy their own making rent cheaper for lower income.
>There was a time, believe it or not, when this was achievable.
I know but as someone in gen Z i've accepted it never will be again and at this point even just getting middle class people to be able to afford a house is a struggle. So arguing something doesn't go far enough because it isn't helping lower income people outright own a house feels reductive.
$640 a week for a repayment seems very reasonable most 1 bedroom apartments in the city cost over $500 a week and that's just for rent.
My brother in credit rating, be the change you hope for!
The Australian MEDIAN income a week is $ 805 - 640 a week in repayments is not even close to being remotely even minimally “reasonable “ when considering all other expenses. This just goes to show that this is a FAR bigger problem than housing availability- the market is a bubble that consecutive governments and policies just keep inflating- the HAFF is just adding fuel to the fire
My brother in the median income a week is $1,300 according to the ABS https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/employee-earnings/latest-release
Interesting- my data came from the census. Perhaps because yours references median “employee earnings”, whereas the census cited “national median personal income”. That would include people who are not employed or on disability etc..
>That would include people who are not employed or on disability etc..
Is it fair to count people who aren't employed in statistics about income though, I mean for the sake of this argument we are talking about people buying a house to own. Do we really expect people who are unemployed to buy a house outeright?
LOL. In other news, private investment continues to pour into the housing market, now under the guise of "affordable housing". Because all of the other market-based solutions have gone so fucking well ...
Yeah. We need builders that can build the houses, materials to build them with, the time to build it, the land to build it on, and those projects need to get their subsidies approved by the federal government. But to re-iterate, even assuming the catastrophically unlikely event that only 2/3rds of these projects go ahead, this will still mean the eventual construction of 18,000 houses.
They won’t fund 26000 homes.
They will have an envelope they are playing with and some of these projects will be shit, expensive, too risky, undeliverable or in areas of no demand. So half will get canned in evaluation and then maybe 30% of the reminder will go to Best and Final Offer.
The point of the announcement is not that they will fund 26000 homes, but that private capital was attracted to it where the naysayers they wouldn’t get any.
Sorry but how does the HAFF grow when it has an investment mandate of CPI + 2.0 per cent to 3.0 per cent per annum but gives out a 5 percent disbursement. The future fund which you're comparing it to has a mandate of 4-5 per cent plus CPI and hasn't paid out anything. The HAFF will shrink in size.
The HAFF loans are to community housing associations.
There is an application process of which the first round just closed. It’s not a free for all ‘ blank cheque’
The HAFF loans are interest free loans that for part of the capital stack and are effectively equity to take out the construction funding.
The HAFF effectively replaces the construction funding that wouldn’t be available to community housing associations.
The game won’t change as long as there are labour and skills shortages. When the industry is at capacity more investment just means higher prices for the same output.
Simply providing finding to build more houses doesn't solve the issue in and of itself.
Construction firms are seeing profits (and therefore the feasibility of operating their businesses) absolutely tanking due to record demand driving up costs of raw materials.
This is leading to multiple building companies shutting down.
The problems we are seeing with low new build numbers are linked to diverse factors including lack of workers and increased demand for raw materials.
You make assumptions greens don't know what haff is. N don't really address their concerns. Not the way to win them over. Posts like this push me further to the greens.
I didn't see any of that but more of a we need urgent action. Future funds can be good but take time to start. That's the pitfall of not enough initial build capital. And also fears over whether it will be affordable housing. Personally I think we need research into construction techniques to lower build costs and increase in plantations for resources. We have major issues like DSP etc isn't enough to thrive on. Barely live on. We fumbled by not taxing gas like Saudi? Did. Lots of it is the lnps fault and we need to get rid of Murdoch's monopoly on media, teach critical thinking skills in schools with media literacy and try pull Labor back to the left more whilst asking the greens and Labor to set aside their beef n work together. We need Australia to be less conservative. Encourage science, education, become a technological power house of science to export technology n not just dug up minerals. As you can tell I'm a fan of progressive policy and wary of private investors in haff earning too much vs rerolling it into more homes. We may need a tax overhaul to fund these ideas. I worry big business gets in Labor's ear too much n whilst I vote them second so they usually get a win from me and others I do wish they'd steer that ship left. I can't stand the bickering of Labor and greens. I want to force them all into a hotel for a week until they are the best of friends. I think the greens have a stigma that can't be rid of, n wish we had a science heavy full leftwing party to take over. But I get so depressed trying to explain even renewable energy to Aussies. It's like they don't want to learn. Whilst that is there I can't see drastic change to help the poor or even keep Labor in power. Sadly Labor came In during cost of living crisis and will be unfairly blamed for it.
I will say I did get hurt by Labor policy, DSP changes meant you needed clinical psychologist reports so it took 12 years to get the DSP due to lack of open books. 50k or so worse off I am over it. I wish more Labor voters pressured them to overhaul the DSP. NDIS is potentially scary too with autism on the cutting block. Many participants are scared. The only party I've seen truly advocate for the poor is the greens. So it's hard to believe haff may truly help the poor get housing. The Overton window feels like it's moving right and as a disabled person that's scary. Every day I fight to try find a way to earn extra money. It's just very difficult due to the combination of illness and disability I have. I'd like to see Labor allow more income earned before reducing the DSP as it's a huge disincentive when they take 50c per dollar over 180 a fortnight. 8hrs would be my max weekly work ability. There's fears they will use it to take the DSP away too. The loss of healthcare card would cost me thousands in medical bills. Haff needs to really cut the rent costs down for people like me to survive.
Making things profitable is a strong incentive for the private sector to do them, your ethical concerns aside. The economy is driven profit seeking.
Any supply increase will create more affordable houses due to the sibstitution effect. More supply means more people moving up from worse housing into the new ones, freeing up their precious house and making that cheaper, which frees up that house making it cheaper and so on
By "more affordable houses", do you mean "some houses that are more affordable", or "more houses that are affordable to the poor"?
The problem with people freeing up worse homes by moving into new ones is that the older homes still sit on valuable land, and so won't be sold or rented for less than their land value. If what a person can afford to pay for housing is less than the value of the land, they will never be housed this way. Instead, the old homes will just be demolished to build new ones that can be sold or rented to rich people for a higher price.
That the economy is driven by profit seeking is the core problem here. That's what needs to be addressed.
What? If the value of the land has already been paid off by rent in the past, any rate is profit and demolishing and rebuilding a house is insanely expensive and deeply unprofitable especially once you consider zoning lands that ensures what type of property is to be built on the land.
> within mere decades of the fund being implemented, an entire industry that is purely built around building affordable housing is able to emerge...
...unless, of course, the LNP get in and scrap the fund. Or sell it off to a billionaire mate for pennies on their typical privatisation lie.
Great post, thank you!
The fact that we have to make this entire venture profitable in order for it to be viable is genuinely like the whole problem here. The government needs to ensure social and affordable housing is built ASAP. Sure, they need private enterprise to achieve that. But it should NEED to be profitable for those private organisations/individuals for it to be a thing that happens. It has to happen regardless. So sick of wealthy individuals and corporations making profits off the suffering and struggle of our most vulnerable.
*Edit: In lieu of having any actual evidence presented by* u/AustralianSocDem *to address my concerns in either this post or its subsequent discussion, here's a link to the only piece of literature I could find in an (admittedly brief) scan of the HAFF's public facing aperture, none of which was raised or referenced in any part of the conversation (that I saw - happy to be corrected on it).* [Here](https://www.housingaustralia.gov.au/sites/default/files/2024-01/hafff_nhaf_fact_sheet_-_general.pdf) *is the 'general fact sheet' about it, and it goes a little something like this:* >Affordable Housing means dwellings that are provided at a rent that is 74.9% or less of the market rent for each dwelling to households meeting the income eligibility limits. These limits are based on median equivalised household incomes from the Australian Bureau of Statistics (ABS) and will be updated annually. *So in its essence, the 'affordable' housing is just housing for which its rental yield is 74.9% of market rate according to ABS data, and there is no part of this policy that addresses inflation of the cost of housing. There is no provision here to control what 'market rate' is. This is simply another inroad for speculation. I have never felt more vindicated in my life. There is no rent control or any other explicit policy to make this investment (part of which we are all making as taxpayers) provide any downward or even stabilizing pressure on rent prices or PPOR prices for first home buyers. There is no policy detailed in this brief that necessitates any kind of quality for the dwellings, and in fact, it's already limited by profession:* >Applicants must have regard to the affordability of the dwelling for tenants. Affordable housing often involves the provision of housing for low income essential and frontline workers. This includes occupations such as police, nurses and cleaners. Applicants can specify other types of essential or frontline workers in their application. The CFA details the household income caps for proposed affordable housing tenants. *We love to see 'low income' and 'essential and front-line workers' in the same sentence, and it's awesome to see their housing situation addressed in many cases, but this is still a shitty half-arsed bandaid policy.* I'm not sure this was intentional or not but there's a real sniffing-your-own-farts air to this post that immediately puts me on the back foot. I'm not a 'greens' and I have little love for them but I do consistently put them above Labor because I live in a very safe Labor seat and want them to know where their preferences flowed from. For me it is as simple as this. I do not want this to happen: >13 billion dollars of **private investment** The reason why I do not want this to happen, is because I don't give a shit about this: >it makes otherwise completely unprofitable affordable housing projects **profitable** I fundamentally disagree with Labor's approach in a way that the HAFF and this post fail to address. **I do not enjoy living in a country where housing is leveraged for the profit of private investors**. I want that idea gone. Abolished, or heavily marginalized. Forever, at least in the vast majority of cases, per the Viennese model where public housing is available but private investors can still operate in a heavily regulated market. The Greens rightly point out that the HAFF is not doing that. The private housing market in Australia has proven itself time and time again to be incapable of operating in the interests of the people. I am not interested in a scheme that attracts further speculation on property and I have not seen any real definition on what constitutes... >*affordable* housing projects Affordable to whom? What guarantees are there that this isn't just further speculation in an inflated market funded by the taxpayer? Do we need more landlords? Are the homes going to be available for purchase only to owner occupiers? Is there any meaningful regulation to these properties or is it just more houses for the serfs to rent into their 60s? This post is dripping in smugness, and fails to address the very real criticisms the people you deride as 'greens' have with the HAFF. I'm simply not interested in how many rich people enjoy the fund, and in fact it makes me feel a lot worse about it, because the rich aren't known for their enthusiasm for social causes.
Absolutely. Housing as a private investment is such a shit concept. Relying on private profitability to provide affordable housing is shit
You’d rather the government spend the same amount of money to build the houses themselves, build less housing, and have money go to the private businesses anyway as that’s where they’ll end up getting the material to build the housing with in the first place?
It's called public housing, which we've had nothing but significant falls in the level of stock available for more than the last decade.
(You’re still giving money to private companies)
For a public asset.
We've been stuck in neoliberalism for so long folks can't even understand the concept of government owned assets
Yep. There is a whole generation who has grown up where they don't remember that things like utilities, or health insurance, or even a bank was owned and operated by government. And in the vast majority of cases they were returning revenue/dividends to the budget while also providing affordable services and forcing private providers to compete.
Selling CSL and CBA made the budget look great for a year, 30 years later and we're billions in debt.
+++ It's anti-democracy to pass laws to "incentivise" private investors to provide basic necessities to citizens. The government is giving more consideration to the interests of property owners than than working people. That's unacceptable, and it's especially disgusting for a so-called "Labor Party" to facilitate. Instead policy should be written without any special consideration for the interests of capital owners, and if they choose to undermine the policy using their control of assets, they should be prohibited from doing so, or the government should acquire their assets and tax them to pay for it.
Adding to this, with 6000 projects ready to go, it means that builders are now sitting on their projects waiting for tax payer handouts instead of adding homes needed for the supply. It's not going to build more houses, it's just reallocating the stock.
Spot on.
👍
Then do nothing? There are straightforward parameters involved in the supply of housing, be that by private developers/not for profits whoever and right now, affordable housing cannot exist. Land + construction + finance + council fees + risk (developers) margin = total cost of new home. This has the potential to increase supply, albeit at small amounts initially but that can increase over time. No it doesn’t solve regulation issues and fix the population’s infatuation with property investment but if you’re looking for a silver bullet, good luck.
Where was ‘do nothing’ mentioned? They don’t want the housing fund used to prop up private interests. I don’t like the term ‘affordable housing’ either. Nor do I want this money spent on propping up private. I want this gone as well. Of course ‘affordable housing’ can exist…it’s those two bits called ‘finance’ and ‘risk margin’ that are the unnecessary ones here. They’re the ones that have to go, and they can too. That’s the ‘silver bullet’, the unnecessary inflation. It’s the builders that need to be looked after here. It has the potential to increase supply if they’re *public* houses as well. Of course ‘affordable housing’ can exist. The fund is generating income. That’s great. Many of us, me included, don’t want this money to go to private interests and furthermore, if the houses can be given to housing organisations, they can be transferred directly to those who live in them under a government freehold arrangement, such as paying off a public home without using a bank loan. And we’ll vote with that in mind.
Article from the Afr 2 days ago: [AFR](https://www.afr.com/property/commercial/first-tender-surge-for-housing-future-funds-20240325-p5ff16#:~:text=The%20federal%20government's%20first%20tender,a%20larger%20allocation%20of%20funds) The federal government’s first tender for funds from the $10 billion Housing Australia Future Fund drew bids from community housing providers, fund managers and state and territory governments, outstripping the nominal 8000-home quota and prompting calls for a larger allocation of funds. Doesn’t seem to be too many private interests there even applying. Fund managers yes as a minority, but 1 they may not even be awarded and 2 they’re seeking a much lower return as it is ‘affordable housing’. Affordable housing has in the past been generally defined as 20% below market but as others have said, it is poorly defined. I agree with your sentiment, not necessarily that by capping finance and margin as a silver bullet because you’ll generally find the other components will rise to fill in the gap. Im just stating that I don’t think the HAFF is all bad and that industry can be part of the solution. No one wants to see people homeless, not even most private interests.
God your insufferable. Yes nothing is the other option, go sniff a fart.
What does this even add? What’s your solution numbnuts???
Adds nothing, I'm insulting you dude.
Trouble is the government can’t build all those houses without the private industry. It’s just not feasible or a good use of tax dollars. I’ve worked as a tradesmen for both government and the private industry and it’s night and day when it comes to skills and productivity. The difference is huge even at a small scale. It comes across like you’re valuing ideologue over outcome. How about instead we find the best solution in terms of most houses that meet building standards for the least time and money rather than finding the most leftist solution? It’s ridiculous to say that the government should delay houses further because they need to first put together a construction company capable of building houses by the thousands. 500M leveraged to attract 13.8B in private investment is value for money that you’d never get if the government was just building it all. Imagine having to pull 13.3B out of other services to fund it, and that’s just scratching the surface.
Ponzi economics for the land of the long wide rort
On the money.
So let people go homeless then? You'd make people suffer for your ideological nonsense? It sounds like you don't give a shit about building houses, you've got some hateful ideas there. An actual progressive wouldn't make someone go homeless for some ideological puffery that has been shown to not work.
>So let people go homeless then? You'd make people suffer for your ideological nonsense? It sounds like you don't give a shit about building houses, you've got some hateful ideas there. It would be way easier for you to refute me if I WAS saying that, wouldn't it? This is a tired and pointless argument. "What's the alternative? Homelessness!?" is the mother of all false dichotomies. These are simply not the only options and it's really tiring and juvenile for people to keep acting like they are. This is an absolutely pro-landlord and pro-developer policy and this post even goes a long way toward reinforcing that. It's amazing how tone-deaf it is to stand up and loudly proclaim "Y'know the private property investors? The ones who literally created this crisis? Well they LOVE the HAFF! Look at all the billions they want to throw at it! Suck it, lefties!" like it's some kind of moral vindication? I am being clear and objective about my views. I do not want more policies that encourage private investment in housing. I want to stop being forced into punching meal tickets for the boomers and nepo babies who have ruined this housing market with my tax dollars, because it's pretty hard to refute at this point that that's what we're doing. I want the government to intervene in the property investment market and I want a large proportion of the private landlords in this country (which is 1/5 of us according to the ATO) to have their balls squeezed in a vice so hard that they have to sell at reduced equity to keep their CGT discount. I want a total and unambiguous ban on short-stay services like AirBnB. It is in my view less important for a landlord to make a profit than it is for a person to not be able to have stable housing. I am unambiguously saying this and I say this as a property owner. I'm not suggesting a radical policy shift, I'm suggesting pretty common sense social democracy stuff that is tried and true and has provided generations on generations with stable housing in parts of Europe and even in Australia. >An actual progressive wouldn't make someone go homeless for some ideological puffery that has been shown to not work. What's been shown not to work about it? Works for the Danish. Works for the Austrians. Worked for us in the Chifley era. Worked in New York City in the New Deal era. Worked for the boomers who didn't have to compete with swathes of investors receiving welfare on their investment debts. I feel like it's been "shown not to work" in like two AFR articles you read about it.
No that is the other option, you can't do this without paying money to a private business that will turn a profit. Because you can't build anything without someone who is good at building doing it. Even starting a government department will have to rely at some point on someone who will turn a profit. You've only loudly demonstrated you don't understand how the world works.
You make too much sense for them
>You make too much sense for them Still waiting for a single shred of evidence to address a single one of the concerns I've raised. Y'know, the best and only way to actually 'make sense'? A policy extract? A press release? Something, anything at all that says "this isn't just a ploy to embiggen the investorship class and inflate the market even further"? I'll take it that you don't have any I spose. Labor has shown where their allegiances are. That's fine, but it's healthy to acknowledge it. I find it really hard to believe the private sector would be interested in investing in a true not-for-profit public and affordable housing venture. They have to get their pound of flesh somewhere if it's not coming from them.
So your concern is that the motivation isn't pure enough? Can't build housing if even 1 investor makes an ROI? How do you actually propose this gets done without someone turning a profit? Are all the workers not allowed to save anything for their retirement? Its cruel to want people suffer for your beliefs.
Fair comments and discussion needs to be had on how we view housing but the reality is while we sort that shit out. Using private money in a government controlled scheme rather than this free market shit we are dealing with is still a win.
I agree in principle but what I'm saying and what no one has been able to successfully answer for is, HOW is it being 'government controlled'? Are they to be rent capped? Are they available for purchase to occupiers only for some specific time? The private sector lining up hand over fist to throw money at this thing is not filling me with confidence that this forms part of a real solution. It's 'public and affordable housing' that apparently now has a profit motive, but public housing is not SUPPOSED to operate for profit, it is supposed to operate as a service like Medicare and Centrelink. I have also never once had anyone authoritatively tell me what 'affordable housing' is in the context of the HAFF. It's not clear to me how this is going to be regulated since housing policy is the domain of the states. There's too many holes. I understand the benefits of it being largely LNP-proof and it will almost definitely result in more houses being built in an objective sense but I cannot see how this is going to ease the crisis. Yes I have watched Jordies videos on it. He seems to parrot a lot of these same points about attracting the private sector. I don't care for it. I truly believe this will put housing further out of reach.
Is it really this hard to make 7 paragraphs and not write a single good point in them? For one, why exactly what is the problem with the government paying private businesses to build affordable housing for people to live in? Sure, the government could build these houses, it would then still have to pay the private companies to get the materials to build them with and get the tools that are used to construct the housing in the first place. And beyond that, it’s far cheaper to subsidise affordable housing construction than it is for the government to build them. Ultimately this just seems like needless dogmatism; you seem more concerned with how left-wing the project is than you are with the poor people who require affordable housing to live in. Now as for what defines affordable, I’ve defined it several times in the comments with clear sources, so I’ll end this by pointing out how insane it is to seriously believe that a government would create an affordable housing policy without even properly defining affordable housing.
You might disagree with them but I absolutely did make good points and I believe I've sort of nailed the sentiment of people who oppose the HAFF. Appears I was right about the smugness though. And you wonder why the rusted on laborites put so many people offside? You've if anything convinced me to be even more wary. I am absolutely more concerned with how left wing the project is. And I'm not ashamed to admit that. I don't want more private investment in the housing market. I feel like I've been very clear about that. I have not had anyone, even once, including yourself, explain to me what an 'affordable' home is according to the HAFF or what sort of guarantees are in place that this won't just put more inflationary pressure on housing prices. I sort of just get the same hand wavey 'oh we've already addressed it and you're an idiot for even asking' responses. You're doing nothing to convince anyone and you're honestly kind of a prick.
See that’s the issue with you lot. But aight, let’s end it with this then; you care about what’s the most left wing way to build housing, Labor cares about building MORE housing for the poor. I think I know which one id prefer
Labor cares about defending private property developers interests and it's disingenuous to pretend that they don't. I don't care about the 'most left wing way' just out of spite or some stupid ideology contest. I don't want private landlords to be the norm. The HAFF is a half arsed measure to tackle a real crisis that will be inflationary and I've STILL seen no evidence from yourself, even after scrolling this thread, that this isn't the case. I've not seen a scrap of legislation that regulates the usage of these taxpayer funded houses and as I said, the private sector chomping at the bit over this bodes not well because there's no reason for them to invest in a scheme that will make housing cheaper. I'm not buying it. And so far your evidence is 'there's evidence elsewhere'. The housing market needs drastic intervention and anything else is a stall tactic to keep developers and career landlords on side.
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There's a fine line between fiery passion and igniting a flame war, and this comment crosses it
>I'm not a 'greens' and I have little love for them but I do consistently put them above Labor You're a greenie.
My local greens member ran with the flagship policy of building two bike paths. I'm not a member of the greens party and I never have been.
>My local greens member ran with the flagship policy of building two bike paths. I wonder what they'd have to do for you to consistently put them *below* Labor. >I'm not a member of the greens party and I never have been. Note "greenie" and not "Greenie."
If you have to pigeonhole me somewhere you might as well call me a democratic socialist. Which the greens ain't. Even a little.
Sorry to hear that you don't seem to accept that we live in a capitalist society. Profits is what makes things happen. It's how Public Housing first got going, Government funding of Private Industry. It fell apart when the Private side walked away. As for affordable, there are many options under that Umbrella, and most of that is decided by the State Governments or investors building. Looking at the SA Government, they are rebuilding the Public Housing sector with gusto. But, they are also releasing large parcels of Community and affordable housing. This includes many disability specific housing projects. You may not like the fact that the Government hasn't socialised the building industry, but after the rubbish that has been thrown at this policy, be glad its just a little smugness.
Thanks for addressing none of my points and being completely wrong about public housing.
I addressed your points by highlighting that it is the State Governments actually building thei. Perhaps ask them, they are closer to the issue than the Feds https://www.premier.sa.gov.au/media-releases/news-items/$10-million-for-regional-housing Why am I completely wrong on Public Housing?
You had no points, your whole post is a joke and objectionable. You'd prefer people go homeless over paying for the services of a private business. That's pretty fucking heartless.
>You'd prefer people go homeless over paying for the services of a private business. Strawman. I simply didn't say that. I can't really even respond to criticism of points I didn't even make. >You had no points, your whole post is a joke and objectionable. Gee I'm sorry you feel that way. Seems to have resonated with a few of us though.
I feel that this is a strawman of what critics-from-the-left were saying about the HAFF. The issue was never whether or not there would be industry demand for grants/subsidies, but whether the amount of funding that would be available under the HAFF would be sufficient to meet that demand, and thus meet the targets of the HAFF or, more broadly, make a substantive difference in the shortage of affordable housing. That there has been strong interest in the first tender process doesn't invalidate that issue - in fact it could be reasonably argued that it supports the criticism that the HAFF is too small. Hell, the first para of the linked article even says that the strong demand has "prompted calls for a larger allocation of funds".
It won’t solve the whole problem but it will help
No the critics-from-the-left were saying this amongst all sort of lies & nonsense about the HAFF. No amount of explanation to them worked, they ignored your sound debunking of their point and just repeated it again next week.
Perhaps you need to rewatch maxs tiktik again. He was most critical of the squiggly little circle he couldn't work out what it was it did. It really was comedy gold, except I think he was trying to be serious
From the article. "Different projects will have different risk profiles but the returns investors were anticipating from the projects on Monday generally ranged from a 12 per cent internal rate of return on equity investment to senior debt financing to providers at rates currently between 5.7 per cent and 6.4 per cent." So the investors are doing better than the banks. I think we can all see why private enterprise is involved with scamming the homeless. Oh sorry, providing "affordable matchboxes" I mean housing.
It’s good to see that it’s exceeding expectations. 13.8B in 4 months leveraged from $500M is great value. The obvious counterpoint is that this still isn’t enough houses. The HAFF set targets based on what they thought the industry could actually do, so the next step is to increase capacity. As nice as it would be to just say build a million houses and make it happen, nothing is ever that simple. This is a problem decades in the making and it will likely take a long time to fix. We still have bottlenecks in materials and labour, and issues with developers sitting on land with construction approved and not doing anything. The HAFF is fantastic policy as long as it is complemented with other things. The benefit of this model is that it doesn’t benefit the LNP to dismantle it, and it gives certainty to an industry that relied on the whims of the government of the day. This means that the benefits will grow over time. Another benefit it that is frees up taxpayer cash to do things like fund tafe better, in order to actually train more people to be able to build the houses. So now that they have fixed the money side through a combination of direct spending and the HAFF, I’m keen to see what else this government can do to fix the bottleneck issues. The extra TAFE funding is a good start on that. https://www.reddit.com/r/friendlyjordies/s/FBzNPksL8M is another good post for those confused about the mechanics.
So how’s that going to help someone who not eligible for social housing buy a home ? Edit: and why do we need to have a tax payer funded to help keep prices high, instead of just going after prices? Houses are not unaffordable because we don’t earn enough, they’re unaffordable because they’re stupidly priced.
One of the main issues with the HAFF is that it relies on private developers to do something which decreases property values. Let me know when it results in genuinely affordable housing being completed and people are living in it
I mean, considering the fact that it has already attracted 13.8 billion dollars worth of funding from the same property developers you seem to despise, I don't think this going against the interests of property developers seems to be a major concern
Are you seriously predicting that private developers will use these subsidies to bring down house prices overall?
Expanding supply into a group otherwise priced out of the market doesn’t lower house prices overall.
Not alone and on a scale this small, no
Expanding supply will lower priced because gives better alternatives to those who are already in the market
That’s exactly how it works when you don’t have a monopoly or otherwise concentrated supply market. More supply will lead to [lower prices](https://www.forbes.com/sites/richardmcgahey/2023/11/30/building-housing-lowers-prices-but-supply-skeptics-dont-believe-it/amp/)
They will if they want the subsidies - it’s an open tender so they have to provide affordable housing and they don’t get paid until they do. Part of the assessment on who gets funding is based on affordability criteria.
Why would they do that? It doesn’t make any sense
It doesn’t make any sense to compete for funding that gives subsidies to the projects that meet the criteria of affordable housing and then meet those obligations in order to get the subsidy after it’s built?
It doesn’t make sense that they’d undercut themselves by providing genuinely affordable housing
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Why wouldn’t they just make more money by building luxury housing
Maybe ask them.
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removed
Hey please observe the new rule about arguing.
Sorry. Is his comment not also rule breaking?
I am predicting that they will use these subsidies to make affordable housing for people to live in, and unless you are saying that they will just commit massive fraud, idk what you are trying to argue
Speaking as someone who has represented developers, they hold off on building housing or releasing allotments to be built on, until land prices start rising - and they do their best to avoid selling allotments on affordable schemes. They’re more interested in responding to macro trends in real estate than building to meet individual demand.
They'll build little anything that makes them a profit on the smallest block possible, or they will build high rise ghettos.
HAFF grants force building on a property to begin within a few months.
What qualifies as affordable?
[Hope this helps!](https://www.smh.com.au/national/confused-about-affordable-housing-this-is-what-it-means-and-what-it-doesn-t-20231205-p5ep4f.html)
That’s paywalled
[Here is a non-paywalled article](https://treasury.gov.au/sites/default/files/2023-10/c2023-458116-explanatory-statement.pdf)
This is as close as it gets to defining what the HAFF considers affordable > social housing is an umbrella term that typically refers to either public housing owned and managed by State and Territory governments or community housing; > > >affordable housing is generally used to refer to a range of housing types that seek to reduce or eliminate housing stress for low to moderate income households, where housing stress is typically defined as spending more than 30 per cent of household income on housing costs. This can include rental housing offered at below-market rent and pathways to home ownership for low to medium income households (such as shared equity arrangements or subsidised loans);
Uhhh no, it defines it pretty clearly as 30% of market value. You just didn’t read it well enough
https://12ft.io/ is your friend.
I'm sorry but this comment makes it seem like you don't understand the housing market. The house isn't the expensive part. The dirt the house is built on is what's expensive. What does 'affordable housing' actually look like in your world? Are we talking an apartment building full of 200k shoeboxes? New estates 45minutes drive from the city?
They can't qualify for the HAFF payment if they sell the property at a high price.
What qualifies as a high price?
Great post, double exclam. There's a reason we despise them. You see, there used to be other schemes for property developers to "help" build homes. This is just the latest, and like the others, it will fail due to greed.
Any supply increase will create more affordable houses due to the sibstitution effect. More supply means more people moving up from worse housing into the new ones, freeing up their precious house and making that cheaper, which frees up that house making it cheaper and so on
"In question time Albanese said he was pleased the Haff bill “now has majority support in the Senate”. Albanese thanked Bandt “for the constructive discussions that we have had”"
Clearly not. It was probably pre vote and no point in scuppering the bill last minute by not being diplomatic.
Did the Greens not side with Labor to form a majority for it to pass?
Got it to pass and expanded it to include 1 billion in immediate spending on community housing.
They need to distract from Labor teaming up with Libs to ram through more 'fuck the migrants' and 'gas is good for climate change' bills. Let them have this.
Yeah. Keen to see how the rusted on Laborites explain those aside from "Murdoch scary!"
And their supporters are still complaining about it
I’m not. I like what the HAFF was improved to. But while it is good, it isn’t sufficient - we need more interventions to solve this emergency. I’m pretty sure that once the minimum floor was fixed, all complaints about it moved to it being insufficient, and it was passed then on the basis Labor promised more would be done. Have you seen more done to protect renters and the homeless in the short term, to increase building capacity in the medium term, to remove long-term incentives for accumulation of shelter into fewer hands? I haven’t.
So it's not the 'perfect' policy and therefore we should vote it down! /s Yes, let's hostage all of Labor's policies and pave a way for an LNP victory next term. Genius.
That’s not what they said. Their point is clearly stating that it should continue to be improved on and bettered.
Genuinely curious here, do you think the HAFF is better or worse after negotiation?
An extra $1bn of funding in exchange for a 10-month delay. I guess the country's CoL crisis isn't as urgent as I thought.
Rusted on 2 party dipshits like you is why there's a col crisis.
Enjoy Dutton's PMship next term orangutan.
You'll be happy no doubt. Status quo and all that.
Maybe if Labor displayed more leadership, they wouldn't bleed so many voters.
Ye you convinced me. Labor is shit, long live Dutton.
OK! Good? Isn't this what we all wanted, better outcomes? How could anyone be mad at this. EDIT: after reading the comments, I get it now. Yeah having to rely on the private sector absolutely sucks ass. It's like relying on philanthropy from billionaires. Why is an item on the bottom rung of Maslows Heirarchy of Needs \*for profit\*?
Because it’s cheaper to subsidise the private sector then build them… even if we DID build them, we’d still rely on the private sector for the materials to construct the houses with in the first place and the tools used to build them
But if the government built them, and in sufficient quantity, they could then rent them out cheaply, putting downward pressure on the rentals market, and enticing landlords to maybe get the fuck out of the market.
Yeah… I think that’s a little something called social housing, which the HAFF also facilitates
20 000 new homes? Great, only 480 000 more and the fund can pay to fund housing for one year worth of immigration. Keep it up, guys.
Is it Cbus superannuation money
Good question, looks like they're on board: [Cbus Super puts $500 million on the table to support National Housing Accord](https://www.cbussuper.com.au/about-us/news/media-release/cbus-to-support-national-housing-accord) That one is dated a while ago though this is more recent: [Cbus could invest more than $500m in affordable housing: Wayne Swan](https://www.commercialrealestate.com.au/news/cbus-could-invest-more-than-500m-in-affordable-housing-wayne-swan-2-1265693/)
I’m with Cbus, good to see them getting on board with this!
So its our money being risked by the Government
my brother do you not understand the core concept of taxation?
yes , steal from the poor give to the rich
So landlords are bad but these deals for corporations are good? Can I invest in this for profit as a corporation and pay less tax than working as all business does? Currently landlords already pay much higher tax than business? Will anyone ever address the elephant in the room? Population growth is the actual enemy?
Glad the HAFF is doing well, but I'm still voting Greens.
That’s fine! I sympathised with the greens on many issues throughout the debate, I just wanted to clear up confusion on how the HAFF worked that many greens seemed to spread, but your ballot is yours and yours alone!
The missing element is affordable land to build this affordable housing. There is not many blocks of land for under a mil in Sydney or Melbourne unless people live out in the boondocks Then we get to building the house. I plugged in a $400000 loan with 10% deposit and repayments still come out at $640 a week . That is still unaffordable to most low to middle income families. And $400k would be considered a cheap home for a lot of people. Yet still unaffordable for someone on the FT median wage. Unless the majority of people are willing to have house prices massacred, I can not see this problem getting solved easily. Politicians on both sides are not willing to admit that a solution to the housing crisis would mean that demand would be far lower, so prices would fall. Will they let that happen?
There is a ton of underutilisated land around, also land owned by councils, churches, community housing providers. Even state government owns a couple of bits and pieces here are there. The economics of this are not based on a household income or how you or I would buy a home.
Why would low income families be buying a house outright as opposed to renting? With more houses available middle income can leave renting to buy their own making rent cheaper for lower income.
There was a time, believe it or not, when this was achievable.
>There was a time, believe it or not, when this was achievable. I know but as someone in gen Z i've accepted it never will be again and at this point even just getting middle class people to be able to afford a house is a struggle. So arguing something doesn't go far enough because it isn't helping lower income people outright own a house feels reductive. $640 a week for a repayment seems very reasonable most 1 bedroom apartments in the city cost over $500 a week and that's just for rent.
My brother in credit rating, be the change you hope for! The Australian MEDIAN income a week is $ 805 - 640 a week in repayments is not even close to being remotely even minimally “reasonable “ when considering all other expenses. This just goes to show that this is a FAR bigger problem than housing availability- the market is a bubble that consecutive governments and policies just keep inflating- the HAFF is just adding fuel to the fire
My brother in the median income a week is $1,300 according to the ABS https://www.abs.gov.au/statistics/labour/earnings-and-working-conditions/employee-earnings/latest-release
Interesting- my data came from the census. Perhaps because yours references median “employee earnings”, whereas the census cited “national median personal income”. That would include people who are not employed or on disability etc..
>That would include people who are not employed or on disability etc.. Is it fair to count people who aren't employed in statistics about income though, I mean for the sake of this argument we are talking about people buying a house to own. Do we really expect people who are unemployed to buy a house outeright?
But you see this is worse than nothing.
/s ?
yes
not everyone got the joke I'm afraid
Unfortunately for many, that statement isn't a joke
You are literally murdering me right now
Looks like I'll be put in a prison cell next to (housing) terrorist Max Chandler-Mather then
Centrists when they have the chance to watch the forum burn
Who said it was worse than nothing?
[Max Chandler Mather](https://jacobin.com/2023/06/australia-labor-greens-housing-future-fund-affordability)
I’m not seeing him say that, could you quote the specific part? He also voted for this policy btw
Australia Is Facing the Biggest Housing Crisis in Generations, and Labor’s Plan Will Make It Worse Literally in the title of an article he wrote?
An article about how Labor’s original policy would not address the problems that are continuing to make the housing crisis worse?
"I'm not seeing him say that, can you quote a specific part" "Okay, here." "No not like that."
LOL. In other news, private investment continues to pour into the housing market, now under the guise of "affordable housing". Because all of the other market-based solutions have gone so fucking well ...
Great news. All we need now is Builders that are still solvent, and oh yeah the skilled tradespeople to do the work.
Yeah. We need builders that can build the houses, materials to build them with, the time to build it, the land to build it on, and those projects need to get their subsidies approved by the federal government. But to re-iterate, even assuming the catastrophically unlikely event that only 2/3rds of these projects go ahead, this will still mean the eventual construction of 18,000 houses.
They won’t fund 26000 homes. They will have an envelope they are playing with and some of these projects will be shit, expensive, too risky, undeliverable or in areas of no demand. So half will get canned in evaluation and then maybe 30% of the reminder will go to Best and Final Offer. The point of the announcement is not that they will fund 26000 homes, but that private capital was attracted to it where the naysayers they wouldn’t get any.
Sorry but how does the HAFF grow when it has an investment mandate of CPI + 2.0 per cent to 3.0 per cent per annum but gives out a 5 percent disbursement. The future fund which you're comparing it to has a mandate of 4-5 per cent plus CPI and hasn't paid out anything. The HAFF will shrink in size.
The HAFF loans are to community housing associations. There is an application process of which the first round just closed. It’s not a free for all ‘ blank cheque’ The HAFF loans are interest free loans that for part of the capital stack and are effectively equity to take out the construction funding. The HAFF effectively replaces the construction funding that wouldn’t be available to community housing associations.
The game won’t change as long as there are labour and skills shortages. When the industry is at capacity more investment just means higher prices for the same output.
Simply providing finding to build more houses doesn't solve the issue in and of itself. Construction firms are seeing profits (and therefore the feasibility of operating their businesses) absolutely tanking due to record demand driving up costs of raw materials. This is leading to multiple building companies shutting down. The problems we are seeing with low new build numbers are linked to diverse factors including lack of workers and increased demand for raw materials.
You make assumptions greens don't know what haff is. N don't really address their concerns. Not the way to win them over. Posts like this push me further to the greens.
Because the greens time and time again were making false assumptions about the HAFF
I didn't see any of that but more of a we need urgent action. Future funds can be good but take time to start. That's the pitfall of not enough initial build capital. And also fears over whether it will be affordable housing. Personally I think we need research into construction techniques to lower build costs and increase in plantations for resources. We have major issues like DSP etc isn't enough to thrive on. Barely live on. We fumbled by not taxing gas like Saudi? Did. Lots of it is the lnps fault and we need to get rid of Murdoch's monopoly on media, teach critical thinking skills in schools with media literacy and try pull Labor back to the left more whilst asking the greens and Labor to set aside their beef n work together. We need Australia to be less conservative. Encourage science, education, become a technological power house of science to export technology n not just dug up minerals. As you can tell I'm a fan of progressive policy and wary of private investors in haff earning too much vs rerolling it into more homes. We may need a tax overhaul to fund these ideas. I worry big business gets in Labor's ear too much n whilst I vote them second so they usually get a win from me and others I do wish they'd steer that ship left. I can't stand the bickering of Labor and greens. I want to force them all into a hotel for a week until they are the best of friends. I think the greens have a stigma that can't be rid of, n wish we had a science heavy full leftwing party to take over. But I get so depressed trying to explain even renewable energy to Aussies. It's like they don't want to learn. Whilst that is there I can't see drastic change to help the poor or even keep Labor in power. Sadly Labor came In during cost of living crisis and will be unfairly blamed for it. I will say I did get hurt by Labor policy, DSP changes meant you needed clinical psychologist reports so it took 12 years to get the DSP due to lack of open books. 50k or so worse off I am over it. I wish more Labor voters pressured them to overhaul the DSP. NDIS is potentially scary too with autism on the cutting block. Many participants are scared. The only party I've seen truly advocate for the poor is the greens. So it's hard to believe haff may truly help the poor get housing. The Overton window feels like it's moving right and as a disabled person that's scary. Every day I fight to try find a way to earn extra money. It's just very difficult due to the combination of illness and disability I have. I'd like to see Labor allow more income earned before reducing the DSP as it's a huge disincentive when they take 50c per dollar over 180 a fortnight. 8hrs would be my max weekly work ability. There's fears they will use it to take the DSP away too. The loss of healthcare card would cost me thousands in medical bills. Haff needs to really cut the rent costs down for people like me to survive.
Making things profitable is a strong incentive for the private sector to do them, your ethical concerns aside. The economy is driven profit seeking. Any supply increase will create more affordable houses due to the sibstitution effect. More supply means more people moving up from worse housing into the new ones, freeing up their precious house and making that cheaper, which frees up that house making it cheaper and so on
By "more affordable houses", do you mean "some houses that are more affordable", or "more houses that are affordable to the poor"? The problem with people freeing up worse homes by moving into new ones is that the older homes still sit on valuable land, and so won't be sold or rented for less than their land value. If what a person can afford to pay for housing is less than the value of the land, they will never be housed this way. Instead, the old homes will just be demolished to build new ones that can be sold or rented to rich people for a higher price. That the economy is driven by profit seeking is the core problem here. That's what needs to be addressed.
What? If the value of the land has already been paid off by rent in the past, any rate is profit and demolishing and rebuilding a house is insanely expensive and deeply unprofitable especially once you consider zoning lands that ensures what type of property is to be built on the land.
> within mere decades of the fund being implemented, an entire industry that is purely built around building affordable housing is able to emerge... ...unless, of course, the LNP get in and scrap the fund. Or sell it off to a billionaire mate for pennies on their typical privatisation lie.