Australian governments have stepped into the market at critical times since the late 19th century to encourage and channel investment in affordable housing. With rising housing stress in Sydney, Melbourne and other areas, the Australian government has now done just that.
The announcement went largely unreported, but it was significant. The guarantee is a crucial piece of the affordable housing policy architecture, complementing the “bond aggregator” (or intermediary) mechanism announced in the budget. Treasurer Scott Morrison and Treasury officials have been working on this intermediary, a National Housing Finance and Investment Corporation, over the past 18 months.
These combined measures should create an efficient private investment pathway into social and affordable housing for super funds, insurance companies and other entities hungry for low-risk returns.
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