NSW

EXCLUSIVE

Mike Baird unveils details of $1.1 billion affordable housing fund

New fund tipped to deliver at least 3000 extra homes to those in need.

Developers, infrastructure firms and community groups are being invited to bid for money flowing from a new $1 billion state government investment fund to deliver at least 3000 extra social and affordable homes.

Premier Mike Baird, Treasurer Gladys Berejiklian and Social Housing Minister Brad Hazzard will announce on Saturday that $1.1 billion in cash reserves will be tipped into a new Social and Affordable Housing Fund.

"This new fund will allow us to unlock new homes for those who need them most": Premier Mike Baird.
"This new fund will allow us to unlock new homes for those who need them most": Premier Mike Baird.  Photo: Matt Blyth/Getty Images

The money will be invested by NSW Treasury Corporation and the returns used to encourage the private and non-government sectors to deliver housing projects over a period of up to 25 years.

Delivery of social and affordable housing is commercially unviable for much of the private sector due to low rents and the current level of government subsidies.

The new model hopes to use returns flowing from the fund to plug the gap and make delivering social and affordable housing an attractive business proposition.

The government says the model could make existing buildings viable for use as social and affordable housing, as well as sparking proposals for new developments.

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Mr Baird said the announcement made good on his promise during last year's state election campaign.

"This new fund will allow us to unlock new homes for those who need them most," he said.

Expressions of interest are due by March 15. Tenderers will be asked to put forward business cases that "achieve social outcomes for tenants".

These include: improving employment and education prospects; providing support to women and children who have experienced domestic violence and people with mental health needs; improving connections between family and community; and achieving economic independence.

Ms Berejiklian said the fund was an example of the government seeking "innovative, value for money, service-driven outcomes that are going to help those people who need it most".

Mr Hazzard said it would complement the government's 10-year strategy for social and affordable housing, which seeks to transfer 35 per cent of government housing to community housing.

The fund has been designed in consultation with the NSW Council of Social Service and private sector lobby group Infrastructure Partnerships Australia.

NCOSS chief executive Tracy Howe, who during the election campaign hailed the proposed fund as "the beginning of something really massive", welcomed the announcement.

"Secure, affordable housing that is connected to transport and jobs, to education and support services, is a crucial piece of the puzzle for reducing poverty and disadvantage in this state," she said.

Ms Howe said she believed the fund had the potential to deliver "far more" than 3000 additional homes.

IPA chief executive Brendan Lyon said the fund "will see thousands of people get stable housing and tailored support services, but it also begins to trial new ways to solve the public housing backlog".

However, opposition spokesman for social housing, Tania Mihailuk, questioned why the government needed to subsidise developers in "a booming housing market" with rents "on the rise".

"This government has demonstrated once again that they are focused on subsidising developers as opposed to people in need," he said.