Page 4804 - Week 11 - Wednesday, 20 October 2010
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provide, and 74.9 per cent is based on a figure brought about by commonwealth tax concessions for not-for-profit housing. Such measures do not, however, reflect what is affordable for the consumer and where it needs to be put into reflecting what is affordable from the demand side of the market.
Earlier this year I was contacted by a couple who were in their 30s with a new-born child. The couple were interested in the OwnPlace and land rent scheme. The government used a cut-off point of around $75,000 per annum earnings for a household to determine eligibility for these schemes. Although the family earned a small amount above this, they found that they were likely to be paying above 50 per cent of their disposable income on housing costs and, as such, could not afford the scheme. It seems a household has to be earning closer to $100,000 a year to be able to afford the scheme, some 30 per cent higher than the $75,000 measure. Looking yesterday at the OwnPlace website, I see the eligibility criteria are currently under review, and I wonder if the government has received significant comment on the criteria from the community.
With regard to the rental market, the government committed to incorporate around five per cent of affordable housing in City West as the area was redeveloped. Yet several years later, the government is stating that student housing in City West that costs about $400 a week is delivering affordable housing. Because $400 a week is considered 74.9 per cent of market rent, it is quoted as being affordable. It is fair to say that some of us were amazed that the government had the confidence to quote such a figure as being affordable when it is clearly out of the realms of many students and others.
I asked the Chief Minister to clarify his definition of “affordable housing”. There was some improvement on the City West example, as the Chief Minister replied that the government defines “affordable housing” as housing that is safe, appropriate and accessible and where housing services are purchased for 30 per cent or less of household gross income.
We are calling on the government today to develop a more accurate definition of “affordable housing”, as we have recently heard of cases or comments where the government has ignored the affordability of running a house. We have been told that large families at risk of homelessness have been placed in houses which have large utilities bills and that the Chief Minister would choose to avoid solar access in pursuit of cheaper construction options.
This is not an either/or debate. Utility costs are integral to the running and affordability of a home. There is no point in constructing cheap houses if people cannot afford the bills that come with the house. It is a known fact that building more efficient homes and providing houses with high energy efficiency levels are much cheaper to live in, have very low energy bills and are more comfortable to live in.
Looking to New South Wales as an example, its office of affordable housing defines “affordable housing” as housing that is appropriate to the needs of a household and is within their means to pay. The means or capacity of a household to pay for their housing depends on three primary factors: the income of the household, the cost of
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