Institutional tax credits could help boost Australia’s affordable housing supply, Industry Super Australia’s (ISA’s) chief economist, Dr Stephen Anthony, told the Affordable Housing Development Summit conference in Melbourne yesterday.
Anthony said that, in response to the national undersupply of sub-market rentals and emergency housing by 350,000 dwellings, government resources would be better directed at attracting big investors into a sector that’s been “long-starved of capital”.
He suggested that institutional tax credits “could be the answer” as they would allow investors to write down, or off, investments in affordable housing without impacting the rate-of-return benchmarks upon which project availability often rests.
Anthony based this proposal on the United States’ Low Income Housing Tax Credit program, which had operated successfully for the last three decades.
ISA said that the government should be responding to this housing issue, as “housing distress leads to homelessness, wage stagnation and welfare dependency, and the productivity loss levies an economic burden on all levels of government”.