Defining what makes housing affordable will be key to legislating the government’s $10 billion housing fund after Greens and crossbench senators made their support for the bill contingent on a list of demands.
The government needs the Greens and two other crossbench senators to pass the legislation after the Coalition announced it would oppose the bill. On Tuesday, the Greens and Jacqui Lambie Network senator Tammy Tyrrell refused to rule out blocking the bill unless their demands were met.
The crossbenchers said in a letter to Housing Minister Julie Collins they were concerned the government’s housing plan – which would use up to $500 million a year in returns from the housing fund to build 30,000 social and affordable homes over the first five years of the program – does not go far enough to address the housing shortage.
Tyrrell said the crossbench was banding together to get a better deal.
“Most states have different definitions of affordable housing. Makes it hard to know what the government is investing in. A good start would be to get everyone on the same page,” she said.
Industry peak bodies and groups have also called for a clearer definition of affordable housing in submissions to a Senate committee, which will hand down its report on the housing legislation on Wednesday.
The Australian Housing and Urban Research Institute said that in some jurisdictions, affordable housing was defined based on household incomes, and in others, it’s defined as housing prices or rents that are below market rates.
“A lack of definition can also mean evaluations of ‘affordable housing’ projects are potentially inconsistent and unreliable,” the institute said.
A report published this week said all five of Australia’s major cities have been “severely unaffordable” since the early 2000s.
In the Demographia International Housing Affordability report for 2023, Sydney ranked the second least affordable city in the world, after Hong Kong, and Melbourne ranked ninth. Adelaide and Brisbane were in the top 20 most unaffordable cities, while Perth was equal 60th.
A separate Domain report found an average first-home buying couple would need to spend half their income on mortgage repayments for an entry-level home in Sydney, while an equivalent couple in Melbourne would hand over more than 40 per cent of their income on the same.
Rental prices have also skyrocketed, due to ongoing record-low numbers of available properties.
Greens housing spokesman Max Chandler-Mather said the government’s housing plan would not fix the housing crisis.
“It’s time Labor recognised their plan will see the crisis get worse,” he said.
“This is parliament’s one chance to make a real difference in tackling the housing crisis, so it would be genuinely shocking if Labor turns down the chance to work with the Greens and Senate crossbench to invest billions of extra dollars directly in building public, community and affordable housing.”
Tyrrell said she was ultimately focused on securing more social and affordable housing for her Tasmanian constituents. The state would be eligible for about 600 homes through the government scheme on a per capita basis over the five years, but Tyrrell is pushing for 1200.
“Everything in that letter, it’s really stocking fillers for me. It’s a great added bonus for the people of Australia, but at the end of the day, I’m elected as a Tasmanian senator,” she said.
As well as redefining affordable housing, the crossbenchers called for: the cap on government spending to be removed; for the government to “substantially increase” its ongoing housing spending; and meaningful action for renters.
The housing minister said community housing groups wanted the legislation passed as soon as possible.
“They are urging the Senate to pass this legislation,” Collins said in question time on Tuesday.
“Our broad reforms to housing are critical, and I would say to those opposite and to the senators, Australians who need it most need this bill to be passed, and they need it passed quickly.”
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