More Affordable Properties Needed to House Renters
Many of the rental real estate markets around the country have been suffering from downward pressure, only to result in prices being driven up.
While this means great news for owners of these rental properties, it also leaves many low income renters without homes to live in.
In a bid to boost the number of affordable housing options across the country, the Urban Development Institute of Australia (UDIA) has called for more houses to be built through the National Rental Affordability Scheme (NRAS).
This scheme is a partnership between the federal government and various states and territories to provide lower income earners with affordable rental accommodation.
The NRAS works by encouraging investors to purchase properties and rent them out at below market level. There are a number of benefits for owners of NRAS homes, such as receiving the NRAS incentive.
Since the initiative has been in place there have been thousands of properties constructed all over the country, resulting in many people being able to afford accommodation.
However, the UDIA stated there needs to be a significant boost in the number of NRAS properties.
According to the UDIA, Australia is facing a shortage of almost 500,000 properties that are affordable for lower income earners.
"Thousands of new affordable rental dwellings have been built under the NRAS program since it began in 2008, providing low income households with an affordable home, and investors with attractive returns," said UDIA National President Julie Katz.
"The most recent round of NRAS funding, which took place earlier this year, will take the total number of homes provided under the scheme up to 50,000, but there is no plan for the future of the scheme once those have been delivered."
An introduction of more brand new NRAS properties could lead to many opportunities opening up for keen property investors.
The UDIA highlighted the fact that the level of homeownership has dropped over the last two decades, leading many people to rent accommodation instead.
In turn, this creates the need for more affordable rental properties in the market.
NRAS homes can make a great addition to a property investment portfolio. Generally, the tenancies are longer as people are willing to stay in their homes for lengthier periods of time, while there is also a steady demand for affordable accommodation.