Shared equity seen as a solution to essential workers' housing problem
The government and institutional investors must consider alternatives to Build to Rent for frontline workers such as police, nurses, and teachers, according to HOPE Housing Fund Management and its home loan partner, Police Bank.
HOPE, a co-investment fund designed to aid essential workers in purchasing their own homes, issued the call following the release of a recent report showing that high housing costs are pushing emergency workers out of inner-Sydney suburbs.
Tim Buskens (pictured above), chief executive at HOPE, said investment in shared equity solutions should be top of mind for government and institutional investors wanting to address the housing crisis for essential workers.
“It’s only going to get tougher for our frontline workers – police, firefighters, nurses – to own a home close to where they work if the only housing solutions that get attention and investment are those like Build to Rent schemes,” Buskens said.
He added that HOPE’s shared equity model, supported by Police Bank since October 2022, addresses the growing affordability issue for essential workers in Sydney. The model has enabled 26 essential workers to purchase homes across Greater Sydney, leading to significant social impact.
Research findings indicate that 77% of homeowners report improved service delivery in their professions, 69% are more likely to remain in their professions, and 86% feel mentally healthier after achieving homeownership.
The HOPE Fund has seen a 12.2% asset growth in properties in the year to June 2024, outperforming CoreLogic’s Index for All Dwellings Sydney, which recorded 6.3% growth over the same period.
“By investing alongside owner-occupiers, shared equity models like HOPE provide long-term financial stability that benefits homeowners well into retirement,” Buskens said. “The model not only addresses immediate housing needs but also enhances the retirement outcomes for all superfund members. Given these significant advantages, HOPE’s approach aligns perfectly with the goals of government and Australia’s super funds.
Police Bank chair Peter Remfrey noted that home ownership is increasingly out of reach for inner-city frontline workers and stressed that government and investor intervention is necessary.
“HOPE’s shared equity model is a proven solution to fix the crisis in housing for essential workers,” Remfrey said. “Government can invest and use the returns to fund further housing initiatives that provide more financial stability than subsidised rental schemes.
“It’s the ultimate win-win outcome, these dedicated workers don’t need a handout – it is shared equity with the structure built in so they can buy out HOPE’s investment over time. The time to act is now, with more than 3,000 police, nurses, teachers, and other frontline workers on the HOPE Housing waitlist who are desperate to live closer to where they work.”
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