NAB tackles social housing shortage with $2 billion pledge

The bank will offer loans of up to $5 million to crisis accommodation providers

A major Australian bank is committing $2 billion towards social and affordable housing as it looks to help vulnerable people struggling to survive in the mainstream market.

NAB will offer loans and develop new financing avenues for not for profits that build specialist housing, including crisis accommodation, community housing, disability housing and sustainable developments.

This pledge comes on the back of Productivity Commission research showing 170,000 Australian homes were making do with less than $35 a day after covering their rent.

NAB spokesperson David Gall said there was currently a lack of long-term funding options for specialist housing providers which contributed to the shortage of social and affordable housing. 

“This is a significant social issue – and we’re determined to help by funding more affordable and specialist homes and improving the capacity and financial maturity of the sector so that it can attract more investment,” Gall said. 

“We don’t have all the answers, but we have a deep understanding of the housing market, financing expertise and the right relationships to have a positive impact. We are up for the challenge.”

NAB will be the first Australian bank to lend at scale to crisis accommodation providers, starting with loans of up to $5 million to help organisations buy suitable properties.

The company will also offer lending and banking services to not-for-profit community housing providers, and boost funding for developers of sustainable housing projects.

Launch Housing CEO Bevan Warner praised NAB for the commitment and said more homes and support were needed to end homelessness.

He said socially responsible lending practices and rent subsidies could help ensure more low-cost homes were built that people could afford to rent.

“The community can end homelessness by working together, and NAB’s announcement is a big step in the right direction,” Warner said.

“It gives organisations like ours the confidence to plan and bring projects forward to both corporate and government funders, to help the growing number of people who desperately need housing and support.”

Disability accommodation organisations like SDA Alliance are also set to benefit from the announcement.

Disability housing has become a major issue under the National Disability Insurance Scheme, with 28,000 scheme participants expected to need specialist accommodation.

SDA Alliance managing director Melanie Southwell said NAB’s investment would help ensure Australians with very high disability support needs have an appropriate place to call home.

“We need a diverse range of investors and lenders to achieve this. Seeing a big player like NAB step up to the challenge is brilliant, and we hope will in turn show others the way,” Southwell said.

“We look forward to working together to grow the sector and successfully meet the housing needs of people with disabilities.”