Australia helps give Americans home while rent pushes upwards in Sydney

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House in Sydney
A newly-constructed home is listed as sold on an advertising board in the Sydney suburb of Greenhills Beach, Australia, August 2, 2016. Reuters/Jason Reed

Aussies are investing $1 billion in affordable housing in the United States, helping make America great again. Although individuals do not choose to place their money into the US affordable housing market, the Australian investment houses and superannuation funds are doing it.

In Australia, the development of properties to rent is almost unheard of. In the US, projects that attract the Australian dollar are built for long-term leases of up to 10 years or more. A percentage of several projects are dedicated to social housing.

While Australia assists to give Americans home, the cost of being a tenant pushes upwards in Sydney. An increasing number of first home buyers find themselves as renters for a longer period of time because they are priced out of the market.

Housing in Australia

NSW Tenants Union senior policy officer Ned Cutcher told Domain that there are more tenants in New South Wales than ever before. Bonds held in the Rental Bond Board are rising more quickly than the population.

Affordable housing in Australia had dropped to 3 percent from 15 percent of the market in some areas. Experts said the housing affordability crisis in the country has become a disaster, making the need for built-to-rent projects urgent.

Monash University’s Shane Murray has warned that an increasing percentage of our community is dealing with housing stress. "I'd particularly like to see opportunities for our key workers our low socio-economic members of the community to have more choice," he said, adding that workers such as nurses, teachers and policemen can live in areas where they are working.

Universities of Melbourne, Monash, RMIT and Swinburne have teamed up to lobby for greater access to affordable and social housing. Murray represents this alliance.

Industry Super Property Trust CEO Daryl Browning said there was no particular build-to-rent housing product here. He hopes the local housing landscape will change through the cooling of property market and new government incentives to invest in affordable housing. The Aussie property market is driven by the capital growth of property sales and owner-occupiers.

Browning said the industry is adaptive enough. "I think you'll get developers starting to say OK, I can't get my profit by building pre-selling apartments, I'm now going to look at perhaps a pile of projects where I will build all of the apartments, but I will hold them for rent and see how it goes,” ABC quotes him as saying.

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