Lead

Australia is attempting to build its way out of a rental crisis through a series of government schemes and planning reforms, but a new investigation by ABC News and its Four Corners program suggests that developers, not tenants, may be the primary beneficiaries. Governments across the country are rewriting planning rules and directing billions of taxpayer dollars to property developers and community housing providers in an effort to boost the supply of affordable rental homes. Yet, according to analysis by Four Corners, the housing on offer is often too expensive for the very people these schemes are designed to help.

Coverage comparison

The reporting stems from two separate ABC News investigations. The first focuses on the design and delivery of a New South Wales (NSW) bonus scheme, which rewards developers with additional height and density if they allocate a share of their project to affordable housing. The second, an investigative piece by Four Corners, analyzed rental listings in NSW and Victoria, finding significant affordability shortfalls. Together, they depict a policy under scrutiny.

The first piece highlights a planned redevelopment in Sydney’s Potts Point, where a decades-old apartment block would be demolished and replaced by a mix of luxury and affordable homes. The second reveals that even when affordable rentals are advertised, they often fall above the median market rate, leaving the lowest-income households with few options.

Key Claims

  • Critics argue that the affordability scheme model fails to deliver genuine affordability while allowing developers to potentially profit.
  • A planning application in Sydney’s Potts Point – submitted by billionaire James Packer’s investment firm and developer Time & Place – aims to replace an 80-unit apartment building with 21 luxury homes and 23 affordable units.
  • The NSW government introduced a bonus scheme in 2023 that permits developers to build up to 20-30% above height and density limits in exchange for allocating 10-15% of floor space to affordable housing for at least 15 years.
  • The National Housing Accord aims to build 1.2 million new homes by 2029, including 20,000 designated as 'affordable'.
  • A Four Corners analysis of affordable rental listings in NSW and Victoria from April 13 to June 11 found that very few were affordable for lower-income households, particularly those on single incomes; some listings were above median market rates.
  • The federal government’s $10 billion Housing Australia Future Fund is subsidizing social and affordable homes, though the analysis indicates that such homes often remain unaffordable for the intended demographic.
  • Developers are receiving billions of taxpayer dollars in subsidies under these programs, according to reports, and community housing providers are involved in the delivery.
The affordable housing model relies on rents set at a discount to market rate, ideally below 30% of a household’s pre-tax income. The Four Corners analysis suggests this threshold is often missed for lower-income earners.

A key concern is that the NSW scheme may erode existing affordable stock. At the Potts Point site, opponents say there will be a net loss of affordable homes if the redevelopment proceeds, despite the inclusion of new affordable units.

Perspectives

  • Government perspective: The NSW government is reviewing its affordability housing guidelines, while the federal government is funding initiatives like the Housing Australia Future Fund and supporting targets to increase new housing supply. The planning incentives reflect a belief that developers can be encouraged to include affordable units.
  • Developer perspective: Time & Place, the developer behind the Potts Point project, has denied suggestions that its proposal would reduce overall housing availability, arguing that the redevelopment will replace an older building with modern accommodation that includes both luxury and affordable homes.
The NSW state government has approved the concept design and early demolition works for the Potts Point development, and is now assessing the detailed proposal. The approval process is ongoing.