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Howe releases papers on housing affordability, finance



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National Housing Strategy NEWS RELEASE

Brian H o w e

Minister for Community Services and Health

UNDER EMBARGO UNTIL LAUNCH IN COMMITTEE ROOM 2R2 11.30 AM, MONDAY 22ND MAY 1991 ^

BH62/91 22/f/91

HOWE RELEASES PAPERS ON HOUSING I PARLiAAAENTARY LIBRARY AFFORDABILITY, FINANCE M IC A H

Major restructuring of housing assistance programs and increased availability of funds for innovative forms of rental housing are two proposals contained in National Housing Strategy papers released today.

The Minister for Community Services and Health, Brian Howe, launched the papers, "The affordability of Australian housing" and "Financing Australian housing: the issues", which are the second and third issues papers prepared by the National Housing Strategy.

"These papers identify some of the barriers to affordable quality housing and present a challenge which Federal, State a governments must pick up," Mr Howe said.

"That challenge must be met through innovative policies, firstly targetting people in greatest need and, secondly, increasing the general availability of finance for social housing."

The Director of the National Housing Strategy, Dr Meredith Edwards, said that, while most Australians could afford to buy or rent housing in the private sector, many lower-income families were placed under severe housing stress in an attempt to meet their housing costs.

"About 10 per cent of lower-income families spend more than half their income on housing. ยท '

"The National Housing Strategy has asked Governments to consider a specific affordability benchmark, whereby no low to moderate income household would need to spend more than 30 per cent of its income on housing. If they do, they would be

considered to be in "housing stress".

"Such a benchmark could be the basis for restructuring rental subsidies," Dr Edwards said.

Dr Edwards said current financing arrangements were satisfactory for most Australians, with financial deregulation and public sector innovations having helped relax some of the barriers formerly faced by lower income families seeking

housing loans.

"However, there is a continuing shortage of finance for low cost rental housing, and innovative, flexible schemes which could help lower income households gain some housing equity."

Dr. Edwards said governments should consider developing new forms of finance for quality social housing, such as housing equity bonds.

"Such forms of finance could increase funds available for social housing such as rental property trusts, public equity partnership projects, housing cooperatives and—local government and community housing projects, and for schemes promoting more flexible tenure arrangements, such as shared ownership and reverse mortgage equity schemes," she said.

Mr Howe said the two papers would make a valuable contribution to the debate on housing, and would form the basis of extensive consultation with community and industry groups.

CANBERRA:

For further information: Dr Meredith Edwards 06 289 5910. Marilyn Chalkley 06 277 7680