Community housing providers prepare for stimulus boost

Housing plays a critical role in our health and well-being.  However a lack of affordable housing is putting increased financial stress on households across Victoria. All too often, this can place people at risk of homelessness but the issue also has other far reaching socio-economic impacts such as undermining workforce participation, education attainment, social security and health. 

In 2020, the Victorian Public Tenants Association (VTPA) estimated 100,000 people were waiting for social housing.  This includes more than 56,000 applications on the Victorian Housing Register. About half of those people fall into the priority category, meaning their housing needs are urgent. COVID-19 and the extended imperative to stay at home during a substantial part of 2020 has exacerbated vulnerabilities. Increased immobility and isolation, coupled with poor housing stock and energy poverty have highlighted the need for investment in affordable and stable housing for low-income households. 

Over the last few months HKA has held a series of roundtables with VIC Community Housing Providers (CHP’s). The series aims to help organisations consider how to address persistent challenges in the sector through collaboration, and specifically, how best to position themselves to apply for and use the planned stimulus funding.  In Victoria the Government has targeted 12,000 new dwellings by 2024. By sharing their experiences delegates are building a clearer picture on how to grow capability and capacity.  We intend to continue round tables through 2021 and expand them to include a greater base of community housing stakeholders. Some of the key findings from the first meetings have included:

• The need for social housing to be recognised as a high priority agenda item by all levels of government 
• Supply of land at an affordable price is a real issue. CHPs cannot afford to pay commercial rates and short term (less than 50 year) leases do not make sense 
• There is a need for better availability of funding on acceptable terms 
• Debt serviceability requires guarantees of subsidies and diversified income streams 
• Scalability is an issue. The stimulus funding is significant at over $1bn per year for the next 4 years. How can CHPs address these opportunities without having to hire a huge team which they will then have to stand down? 
• CHPs need to find ‘honest brokers’ with whom to build relationships to deliver at scale 
• CHPs are long-term holders of assets. They are concerned about Life Cycle Cost and about maintenance budgets in order to make their commercial models work 
• Reaching the Government’s sustainability and energy ratings will be challenging within the CHPs’ financial model 
• There is an opportunity to improve the public perception of the CHP model by raising awareness, providing better communication and broadening engagement and consultation.     

Retrofit and new build approaches

As old building stock reaches the end of its lifecycle, retrofitting and redevelopment are becoming increasingly common. One of our roundtable findings was the difficulty that CHPs have with the supply of land at an affordable price. The redevelopment of sites that are owned or transferred from other agencies can alleviate this. There is an increased complexity if the site is to remain live during the redevelopment but this can be overcome with detailed advance planning, a robust staging and transition plan and excellent stakeholder communication.

During the year HKA assisted HousingFirst, one of Victoria’s leading CHPs, with just such a problem on a redevelopment site. Consultancy included transition and service delivery planning, staging advice, risk assessment, stakeholder management and communications planning.

During the year HKA assisted HousingFirst with transition and service delivery planning, including advice on key milestones, transition and service delivery activities, risks, stakeholder management and communications planning. HKA worked with HousingFirst, understand the brief and deliver a first rate service.

Danielle Leigh, Housing First

One provider that is looking to push the envelope in regards to sustainability is PassivePlace. The group has partnered with the North Grampians Regional Council to develop a first Net-Zero community. Designed to Passivhaus Standard, the 8Ha housing project in Stawell will deliver the highest environmental living standards, to a region experiencing critical housing shortages. The HKA team developed the initial Project Management Plan to facilitate engagement with potential investment and delivery partners. HKA also provided PassivePlace with high-level programming advice for the project.

This significant investment is clearly an opportunity to make a big leap in capability and capacity. I think the really exciting opportunity here is to consider how we will make that leap in relationship to community, rather than focusing on volume of homes delivered. I’m looking forward to working on that with our clients and the sector as a whole.

Mary Casey, HKA Project Director, Social Infrastructure

HKA has a long history of working with social enterprises, Community Housing Providers (CHPs) and Government in the social housing sector, providing support for stimulus programs and assisting with business cases, procurement, commercial optimisation, sustainability consulting, and delivery.  Our team is committed to supporting our partners in building resilience across the sector whilst building advocacy for sustainable welfare models. 

About the Author: David Foxley is a Director at HKA and Leads the Victoria Advisory Team. He has successfully delivered numerous major projects in a wide variety of sectors including social infrastructure, transport and aviation. His experience covers the full breadth of the project life cycle including management of the business case, stakeholder engagement, commercial models, feasibility, planning, design, procurement and contract management.

David is based in HKA’s Melbourne office. Please reach out to David if you would like to discuss this article or hear more about HKA’s Advisory Services in Victoria.