Australia needs one million new affordable and social homes, researchers say

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Addressing the shortfall in affordable and social housing will require governments to invest, advocates argue—but it’s “entirely doable with political will”.

Australia must embark on a building spree just to meet the backlog of housing demand and keep up with population growth, according to analysis by UNSW’s City Futures Research Centre.

The researchers estimate the country will need 728,600 new social housing properties and 295,000 affordable rental homes by 2036. Currently, just 46% of Australian households in need of social housing are receiving it.

“Our analysis shows that the sheer number of households in rental stress across the country means that if we’re going to meet the need, at least 12% of all our housing by 2036 will need to be social and affordable housing—which is a very reasonable ambition in global terms,” said lead researcher Laurence Troy.

The research is the first to model current housing shortages and the projected need for affordable housing across Australia. It builds on analysis last year of the best way for government to fund social housing.

Community Housing Industry Association NSW Chair John McKenna said the new study provided valuable data that would help the sector and governments plan housing where it is most needed.

“The study gives us a very clear picture of exactly what housing is needed in local communities not just in NSW and across Australia, which is invaluable information for developing desperately needed housing strategies at both a state and a federal level,” McKenna explains.

One-third of all homes are needed in NSW, but regional Tasmania and South Australia have the highest rate of growth needed in social housing for households in the most chronic rental stress.

“The number of homes that we need is clearly enormous but it can be delivered if all levels of government work together and recognise that subsidised housing is not possible without government subsidy in some form,” said McKenna.

Finding a solution

The new figures show Australia’s housing crisis is still real for many Australian households, said Kate Colvin, spokesperson for the National Everybody’s Home campaign, an alliance of key housing and homelessness peaks, community groups and charities.

“This new study looks at live ABS and rental stress data to determine how we are meeting the housing needs of low and middle income households in every part of Australia,” Colvin said.

“It shows the housing system is far more broken that we first thought—but it also shows that delivering the scale of new homes for people who need them is entirely doable with political will and commitment.

“According to the modelling, the most cost effective way of providing the one million new social and affordable homes we need is for government to invest $8.6 billion a year in capital grants for not-for-profit, rather than for-profit, housing development.

“To put it in perspective, the Australian government currently spends $11.8 billion in subsidies for property investors through negative gearing and capital gains tax concessions. That’s already twice as much as it is spending on social housing, homelessness and rent assistance put together.”

The Everybody’s Home Alliance is asking all parties to support a plan to: 

1. Prioritise home buyers by reducing negative gearing and capital gains tax exemptions—and use the revenue it raises to help fund more social and affordable housing options for ordinary Australians;
2. Develop a national strategy for providing 500,000 social and affordable rental homes;
3. Support renters by ending no grounds evictions and unfair rent rises;
4. Provide immediate relief for Australians in chronic housing stress by increasing rent assistance to reflect increasing housing costs; and
5. A real plan to end homelessness in Australia by 2030.

“Voters still rank addressing housing affordability as the fourth most important issue for the government to address over the next 12 months, ahead of ahead of limiting Australia’s migration,” said Colvin.

“We need to rebalance the budget and really redirect the funding for housing to where it’s needed most so that everybody in Australia has a home.”