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Financing New Housing Supply – Rabbits and hats

Explore international approaches to financing new housing supply, including attracting private capital, government support, and tax incentives. Learn about the National Housing Finance and Investment Corporation and the Bond Aggregator, and how they aim to unlock supply and create incentives for private investment in affordable housing.

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Financing New Housing Supply – Rabbits and hats

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  1. Financing New Housing Supply – Rabbits and hats Peta Winzar

  2. How much housing? • National • 1.4m low income renting households • 44% in rental stress • Victoria • 305,000 low income renting households • 46.7% in rental stress • 53% of private renters in rental stress • 127,000

  3. How much housing, how much money ?

  4. International approaches • Private capital to support L-T supply of affordable housing • Government support • to attract cost- effective private capital, • reduce direct call on taxpayer funds • Tax incentives, grants, guarantees, regulatory framework, good delivery system • Governments support revenue streams via welfare payments to tenants/other payment programs

  5. High hopes and a promise 2017 C/W Budget aimed to: • Unlock supply • Create the right incentives for private investment • Improve outcomes for those most in need Along with state Budgets, potentially a step-change for affordable housing

  6. Unlocking Supply • National Housing Finance and Investment Corporation (NHFIC): • $1bn National Housing Infrastructure Facility , Bond Aggregator • Western Sydney housing package • $70bn on transport infrastructure from 2013-14 – 2020-21 • Inland rail, City Deals, Badgery’s Creek airport, etc • Managed Investment Trusts (MITs): • Increasing Capital Gains Tax discount – 60% for individual investors • Release of ‘suitable’ Commonwealth land

  7. National Housing Finance and Investment Corporation • $1bn National Housing Infrastructure Facility (NHIF) • $600m in concessional loans • $225m in equity investments • $175 in grants • Bond Aggregator • Government guarantee • Terms and price not yet revealed • Capacity building component for CH industry

  8. National Housing Infrastructure Fund • Housing-related infrastructure • Extra supply or bring forward • State, local governments can apply – also registered CHOS • Alone or part of Special Purpose Vehicle

  9. Bond aggregator • Facilitate private and institutional investment into affordable housing sector • Domestic and international investors • Simpler for CHOs to access efficient finance – cheaper $, longer tenor • Currently sector: $30b, net assets estimated at $10b, debt around $1b • Aim: refinance existing debt, expand affordable housing

  10. How much difference will BA make?

  11. WHAT TYPE OF HOUSING DOES AGGREGATOR FUND?

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