Boosting affordable housing
We are tackling the housing affordability challenge head on with innovative financial modifications that will make housing more equitable and achievable – so that housing is within reach for every Australian.
The Greens believe it’s time to harness the $2 trillion dollars locked up in super funds, using the innovative and responsible funding mechanisms available in the UK, USA, France, Canada, Austria and the Netherlands – to drive a stable and proven way to fund much needed supply of affordable rental housing.
Modelled after the highly successful Greens initiative the Clean Energy Finance Corporation, the Affordable Housing Finance Corporation will issue housing supply bonds and zero interest loans worth $2 billion.
An initial federal investment of $47 million will be leveraged to generate $2 billion in bonds administered by the Affordable Housing Finance Corporation. This would finance the construction of 7200 homes a year for Australia’s most vulnerable people.
The Affordable Housing Finance Corporation will provide mum and dad investors with a secure ethical option that will boost construction jobs and help reduce the woeful waiting list for affordable housing.
How the Affordable Housing Finance Corporation would work
- Zero interest loan bonds worth $200m per year– called “social housing growth bonds” providing zero interest long term loans to non-profit housing organisations, Public Housing Authorities, and affordable housing developers
- Tax smart housing supply bonds – long term, fixed term, fixed interest bonds (6% return) with a tax incentive (no tax is paid on the return) to appeal to retail investors
- AAA Housing Supply Bonds – a fixed interest (5% return), long term, AAA rated (government guaranteed) bonds to appeal to institutional investors such as super funds
Each year, the AHFC would provide low interest loans for non-profit housing organisations:
- 4800 loans of up to $350,000 for standard housing
- 2400 loans of $150,000 for homes built from high quality sustainable prefabricated materials or alternative ‘fast build’ construction.
Priority will be given to sustainable new build infill in urban or regional regeneration areas close to public transport and community hubs.
This initiative will create thousands of jobs in the construction sector and drive economic activity.
Image: CODA studio #designperth