SHOULD I INVEST IN SOCIAL HOUSING?
Forward-looking property investors are keen to commit to projects with good rental yields and capital growth that are sustainable and add value to the local community. For this reason, investing in accommodation specifically designed for social housing can be a great option.
Social housing is a term used to describe a combination of public housing owned by a government authority or community housing. Most social housing is owned and managed by registered Community Housing Providers (CHP), but charities, churches or community organisations also work in this space.
The aim of these organisations is to provide suitable accommodation for their clients located in areas easily accessible to services and community connections. In addition, the home should be inclusive and cater for people with a disability to maximise their capacity to live independently.
Over the last 20 years, it is estimated that up to 10% of all Australians have accessed social housing. However, only about a third of those people who access social housing do so on a continual basis. This group tends to be older Australians and is more likely to be females on disability or age pensions.
Research conducted by the Australian Housing and Urban Research Institute (AHURi) found many pathways leading in and out of social housing. For example, for someone at risk of homelessness secure accommodation through social housing is often a launchpad to more stable employment and general market housing.
Across the nation, social housing can exist in apartment blocks, townhouses or stand-alone properties. These homes are designed to be inclusive for a wide variety of tenants. They often have slightly different specifications from a standard build, for example, the inclusion of wider hallways and doorframes for participants in a wheelchair.
At Triple Zero Property, the social housing projects we have partnered with are unrecognisable as ‘social housing’- they look like and feel like any other home in the neighbourhood. This encourages diversity and inclusivity in the community but also means if it is no longer needed for social accommodation, it can be repurposed and reoccupied for the general market.
Homelessness has always been more acute in the big cities, but over the past few years, affordable housing is now an issue in the regions as well. For Australians to be eligible for social housing, it is linked to income with a priority for those with health problems, disability, and homelessness. Everyone should have access to affordable, safe and secure housing but it takes a team to match the needs for some of the vulnerable members of our community with available housing stock.
“It’s really important to have your own space, to have a sense of control over where you live…” – Social Housing Recipient
Social housing relies on a partnership between the community housing provider, support service providers (to deliver health and other support services for tenants), local and state governments and the private sector. This team approach is necessary to ensure that the location and style of home matches the right mix of tenants and their requirements.
If you want to invest in property that is sustainable, accessible and improves the quality of life for more Australians,there are options available. Firstly, your financial investment needs to stack up and this is where an independent, professional team (financier, accountant, conveyancer, and property specialist) can guide you. For investors, social housing can provide long-term rental security through a head-lease with a registered Community Housing Provider. Some CHP’s are obtaining market rent and leases include an annual review.
Danny Buxton, Director of Triple Zero Property explains, “while investing in social housing may not be every investor’s choice, it can be a great option knowing that your home is making a real difference for someone else”.
“Clients come to us to help them secure an investment property because they want a growth-focused, long-term financial investment, but that is just one requirement. The more astute investor wants a quality home that is sustainably built and good for the community in which it is located”.
The location and the design of the home is vital to the long-term viability of the project:
- Is it close to community services, transportand employment hubs?
- Does the design reflect the tenants needs?
- Is the builder a specialist in these types of homes?
- Will the specs be a quality home that is designed to last (cheap homes that need renovations after ten years are not good for the planet!)?
- Is the location and build approved by a Community Housing Provider?
This content is general information only. Your situation is specific and individual; as such, you should always consult a registered and qualified professional within the particular area of advice needed.