Developing Specialist Disability Accommodation Within the NDIS

The Summer Foundation and PricewaterhouseCoopers have released a joint report into the threats and opportunities for more accessible and affordable market-led housing under the National Disability Insurance Scheme (NDIS).

Called NDIS Specialist Disability Accommodation: Pathway to a Mature Market, the report set out what it described as a “framework for building thousands of new houses for people with disability, by maximising the potential of NDIS housing payments to stimulate the market”.

In July 2016, the NDIS introduced a funding provision with “the potential to allow 28,000 Australians with disability to move into accessible and affordable housing, called Specialist Disability Accommodation (SDA)” worth $700 million.

The report said that all sectors needed to work together to create new housing that was accessible and affordable, including options that enabled people with disability to live with their partner and/or their children.

“The current status of the disability accommodation market is fragmented and underfunded. As a result, it is an inflexible market where consumers have limited choice in their housing options,” the report said.

“The community housing provider (CHP) sector has been subject to inconsistent and fragmented approaches between jurisdictions and insufficient leadership at the federal level.

“It is essential that all aspects of the sector support and enable each other, for example, in areas of funding and financing, housing supply and management frameworks. This means collaboration between the levels of government and their support of CHPs.

“Growth of the SDA market will rely on a clear compliance and regulatory system. The national regulatory system for CHPs is an example of how national harmonisation in regulation and registration can help develop this market.”

Summer Foundation CEO Di Winkler told Pro Bono News that she was optimistic about the government, private and community sectors developing up Specialist Disability Accommodation as a mature market in Australia.

“What we have is a housing payment through the NDIS which is a well-designed scheme that has the potential to use government money to leverage private capital and to quite a significant market for housing people with disability,” Winkler said.

“Currently government and philanthropy don’t have enough resources to build the scale of housing required for people with disability across Australia. So what these NDIS payments do is provide an additional subsidy for people with disability to cover the cost of building accessible housing as well as provide a market return to the housing provider.

“What we have had in the past is one off grants with segregated specialist housing. What the possibility for this new scheme in a mature market is, [is] that the large developers will routinely include integrated housing for people with disability in any new site.”

Winkler said one of the main recommendations in the report was for certainty around payments and pricing.

“The NDIA and federal government need to provide more certainty around payment and certainty on how prices will be reviewed at the end of five years so that institutional investors and large scale developers can commit funds to building new housing,” Winkler said.

“There are developers and banks looking at how to make this work and I am optimistic about it.

“We feel that this new payment scheme is well thought out but we also feel like not everybody in the sector understands or has a vision of what market-based housing for people with disability will look like.

“Some people are still thinking under the current way of providing housing.”

Specialist Disability Accommodation – Courtesy Summer Foundation

She said the new framework would “absolutely” revolutionise the way disability housing was delivered.

“This is about giving a housing subsidy to the person with a disability so that they have the purchasing power to decide where they are going to live. So it flips around choice and control and also in a market-based system it is up to the housing provider to make sure that they are building something that’s quality and in a location that’s going to meet the needs and preferences of of the market,” she said.

“At the moment there is so much demand and people don’t have any choice.

“Most of the disability housing will be developed by either private sector developers or the community housing providers (CHP). Ideally when CHP or other developers are actually building houses that they are incorporating SDA developments into their dwellings.

“When we talk about a mature market it’s having the supply meeting demand in the 10 year time frame.

“The foundations are there and now it’s up to the sector to make use of what the payments were designed to do. I see it as an exciting time rather than a daunting one.”

The report said the current market for disability housing showed:

• limited availability of housing stock;
• few funding sources for development;
• minimal transparency of potential tenants;
• a new and uncertain regulatory regime with insufficient future guarantees; and
• an inadequate understanding of the SDA regime by developers, investors, contractors, property managers, disability service providers, people with disability and their families, and in some cases, various levels of government.

It said that an effective and mature SDA market needed:

• a sufficient supply of various forms of dwellings that meet the requirements of a range of accessibility needs in a variety of locations;
• a large variety of financing options (both debt and equity) and financing terms,including banks, institutional investors, high net worth individuals, families of tenants, developers and other innovative forms of financing (eg social infrastructure bonds) underpinned by a good understanding of the vacancy risk;
• a transparent portal allowing consumers to locate and adequately assess available SDA dwellings and property managers (or developers) of SDA dwellings to identify potential tenants;
• a stable and transparent regulatory regime that encourages investment, including supportive planning and zoning regulations, release of government land in suitable locations, privacy protections for tenants, and secure tenancy laws supporting the rights of tenants and enabling appropriate and efficient dispute-resolution processes with property managers and owners;
• a strong understanding of the SDA regime by all market players, including certainty of SDA pricing, scope and availability of SDA rental payments, potential tenants for housing in various locations and cost of building SDA compliant dwellings; and
• efficiency and safety in providing disability support services in SDA dwellings, including consideration of geographic location and close alignment and coordination between SDA owners and property managers, disability service providers and tenants and their families.

“Current regulations will need to be reformed and a new approach to safeguarding people with disability needs to reflect and support a very different and much more positive housing landscape in the future,” the report said.

“We need to begin with a vision for this bright future. Without a clearly articulated vision, we risk developing a regulatory framework that is not aligned with our aim.

“For example, there is a risk of encouraging more segregated and institutional housing, rather than housing integrated into communities.

“This journey will involve multiple market players, including government, finance providers, real estate developers and people with disability. The transformation is about replacing the old model of segregation and congregate care with a new model of community inclusion, where people with disability decide where they live and who they live with.

“Achieving this transformation will require the many potential market players to consider what role they can play.”

The full report can be downloaded here.