We develop affordable housing for very low, low, and moderate-income earners. We do this by:

• Providing floor space incentives for developments which contain affordable housing. This is managed through the planning mechanism of the State Environmental Planning Policy (Housing) 2021 (Housing SEPP).
• Facilitating other incentives for developments which contain affordable housing via mechanisms such as negotiated/voluntary planning agreements (enabled through the Environmental Planning and Assessment Act)
• Offering financial and other incentives, in partnership with the Commonwealth Government, to build and rent new properties at below market rents
• Making grants available to assist construction of new affordable rental housing. This is managed through the Community Housing Innovation Fund and Social and Affordable Housing Fund
• Facilitating partnerships between community housing providers, local government and others, including private developers, on affordable housing projects
• Helping councils to secure affordable housing.

Affordable housing (as a discount to market rent product) commonly requires a subsidy or assistance from one or more levels of Government to make development feasible. Generally, a range of measures and partners will be required for an affordable housing project to stack up financially.

Partnering with community housing providers

Organisations such as private developers, councils, church-based groups and co-operatives can partner with community housing providers (CHPs) to develop affordable housing.

Partnerships bring together key components such as land, funding, development expertise and skills. Bringing together these components can result in the delivery of development projects which no single partner could achieve on its own.

CHPs can also manage affordable housing properties on behalf of organisations, individuals and consortiums.

Many private developers and individuals already have successful and ongoing partnerships with CHPs, and CHPs have a proven track record. In the past decade, CHPs have invested over $1.82 billion to deliver 5,300 new homes, with more than 2,600 new homes in the pipeline to be delivered by 2026.

Benefits of partnering with CHPs and CHP ownership

The NSW Government has recognised the not-for-profit community housing sector as a key delivery partner in providing affordable housing solutions.

Community housing providers (CHPs) are non-government organisations which manage and/or own more than 54,000 social and affordable housing properties in NSW, including 34% of the social housing available.

CHPs own, manage and develop their own properties and manage properties on behalf of government, local Councils and private landlords.  They are also responsible for the management of affordable housing delivered under the Housing SEPP.

Not-for-profit community housing providers re-invest any profits from affordable housing into the provision of more affordable housing and/or to improve the services they deliver.

NFP CHP ownership strengthens the CHP’s financial position, which enables better servicing of social housing clients and more opportunities to leverage funds for more social and affordable housing development. It also reduces the pressure on social housing (provides exit opportunities) and on private rental market (provides alternative, more affordable options) and enables them to hold properties as affordable in perpetuity.

The value of partnering with CHPs and CHP ownership was confirmed in a 2022 report by the Paxon Group which considered various partnership models for local government when delivering affordable housing. The report found that partnering with CHPs provided value in the delivery, operation, management and maintenance of affordable housing. It also found that this value was enhanced when ownership was transferred over to the CHP, as the CHP was then able to leverage that housing to borrow money and provide more affordable housing outcomes.

The report estimates this value to be around $60,000 per dwelling, as well as the costs avoided by councils for future liabilities associated with maintaining the properties. It also estimates that this partnership approach generates up to 21-27% more affordable housing over the longer term.

For more information about affordable housing, or if you have a question, contact us at CAH@homes.nsw.gov.au.

Finding a CHP to partner with to develop or manage affordable housing

To do business with government, or to manage affordable housing, the CHP must be registered.

CHPs must be registered under the National Regulatory System for Community Housing (NRSCH) or the NSW Local Scheme.  This registration provides assurance of a viable and diverse sector, that delivers quality outcomes for tenants and in which investors and partners can have confidence.

Many registered CHPs are interested in discussing partnership opportunities for developing or managing affordable housing. If your organisation is interested in exploring partnership opportunities with community housing providers, please use the search tool below to find a CHP, and contact them directly.

Examples of affordable housing development projects

Many councils have identified the need for affordable housing in their communities and have been working in partnership with CHPs and the NSW Government on development projects. A range of mechanisms are being used, including:

• Gifting land or selling it at discount to market rates
• Raising funds through contribution schemes
• Using Planning Agreements

The following examples demonstrate how some of these mechanisms are being used.

Gifted land - Lismore Affordable Housing

• DCJ worked in partnership with Council and Landcom, providing part funding for the
• development of around 60 affordable housing dwellings on a site in Lismore.
• Council provided land at no cost.
• Landcom will develop the land
• The remaining cost of construction will be borne by the CHP.
• Units are planned to be available for rent in 2025.

Gifted land - Bomaderry Affordable Housing

• In the Bomaderry Affordable Housing Project, DCJ worked with Shoalhaven City Council and Southern Cross Community Housing to deliver an affordable housing development.
• Shoalhaven City Council transferred land (14.1% of the project cost) to Southern Cross CHP for a cost of $1 subject to the value of the land being used for long term affordable housing in the LGA.
• Southern Cross is contributing 55.5% of the project cost, sharing the cost of the construction with DCJ which provided 30.4% of the project cost for the development of 39 affordable housing dwellings.

Land at discount to market - City of Sydney and St George Community Housing

• Landmark urban renewal in inner city Redfern
• City of Sydney sold land to St George Community Housing (a not-for-profit CHP) at discount
• St George Community Housing debt funding and DCJ grant funds supported the build
• Completed June 2021. Total of 162 units - 40 social and 120 affordable housing units, including 27 units for people with disabilities
• 45% of units allocated to Aboriginal households

Land at discount to market – City of Sydney

• The City of Sydney sold land at Green Square at a discount to City West Community Housing to develop 200 affordable housing units on Botany Road Alexandria.
• Council also sold the adjacent lot to St George Community Housing at a discount to develop an extra 80 affordable housing dwellings.
• The housing is rented at below-market rates to low-income workers.
• The subsidised sale of both sections of land represents a $5 million discount on market value.
• In total, the council has offered almost $20 million in discounts to community housing providers through subsidised land sales.

Contribution Scheme - City of Sydney - City West

Mechanism: Developers contribute .8% of residential and 1.1% of non-residential floor space, or monetary equivalent, to City of Sydney Council.  The scheme was later expanded to other locations in the LGA, with a higher contribution requirement.

CHP partner: contributions transferred to City West Housing (a not-for-profit CHP), which owns and manages the properties

Outcome: 900 affordable housing units for key workers and low income households

Contribution Scheme - City of Sydney - Southern Employment Lands

Mechanism: rezoning of land and resulting contribution scheme raised funds for affordable housing

State government partner: DCJ held the funds and jointly conducted tender with Council to select CHP partner

CHP partner: contributions transferred to Bridge Housing (a not-for-profit CHP), which contributed its own funds to purchase and renovate 20 units

Outcome: 20 affordable housing units for working Aboriginal women on very low to moderate incomes

Planning Agreements - St Marys Affordable Housing

Mechanism: Voluntary Planning Agreement requires developer (Lendlease) to transfer 120 lots for affordable housing

State government partner: DCJ tendered for CHP partner and contributed grant funding

CHP partner: ownership of lots transferred to BlueCHP (a not-for-profit CHP), which leveraged the land and contributed funds

Outcome: 168 affordable housing properties being delivered

Planning Agreements - Rouse Hill Affordable Housing

Mechanism: Voluntary Planning Agreement requires developer to transfer 3% of lots for affordable housing

CHP partner: ownership of lots transferred to Link Wentworth Community Housing (a not-for-profit CHP)

State government partner: DCJ tendered for CHP partner and contributed funds

Outcome: 38 affordable housing properties developed

Planning Agreements – Affordable Housing – Leichhardt Project

Mechanism: Voluntary Planning Agreement required developer to provide 7 units of affordable housing

State government partner: DCJ tendered for CHP partner

CHP partner: Bridge Housing, which leveraged ownership to develop 4 additional units of affordable housing

Outcome: 11 affordable housing properties developed

More examples are available on the NSW CHIA website in their report Local Councils taking action on affordable housing.

For more information about affordable housing, or if you have a question, contact us at CAH@homes.nsw.gov.au.

National Rental Affordability Scheme (NRAS)

The National Rental Affordability Scheme (NRAS) is an Australian Government initiative in conjunction with the states and territories and aims to:

increase the supply of affordable rental housing

reduce the rental costs for low to moderate income households

encourage the large-scale investment and innovative delivery of affordable rental housing.

NRAS properties can be owned by investors, community housing providers or private NRAS approved organisations.

NRAS properties are usually managed by community housing providers or Real Estate Agents.

Note the National Rental Affordability Scheme (NRAS), implemented in 2008, is winding down and will finish in 2026.

More information about NRAS can be found here.

More information about eligibility for an NRAS property can be found here.

For more information about affordable housing, or if you have a question, contact us at CAH@homes.nsw.gov.au.