CHURCHES plan to free up city properties and huge tracts of land throughout Victoria for inexpensive housing in a dramatic move to combat the deepening home-affordability crisis. Church-run charities say prime land worth hundreds of millions of dollars, some of which has sat idle under church governance for more than a century, should be used to develop affordable rental homes for the state's most needy.
The proposal, backed by Uniting and Catholic church charities and the Salvation Army, comes as the Reserve Bank of Australia is expected to announce another interest rate rise this week, further fraying the threadbare mortgage-repayment purses of Australian families.
Analyst Martin North, of Fujitsu Consulting, says JP Morgan/Fujitsu research shows up to 300,000 Australians are at risk of losing their homes this year by defaulting on their mortgages. An estimated 750,000 households will struggle to pay food and essential services bills.
"This is a problem that is now hitting middle Australia … Rates will go up by another 0.5% to 1% over the year, so people who are in an already fragile position are going to be hard-hit," he said.
The mortgage crisis has increased pressure on the already tight rental market, leaving many poorer people with no hope of renting a private home.
Which is why UnitingCare Victoria, the Catholic-affiliated St Vincent de Paul Society and the Salvation Army will seek State Government approval to operate housing associations and become developers.
Multi-faith charity Melbourne Citymission, which does not have any surplus land, wants to raise funds and work with the corporate sector to create housing for the needy, especially homeless youth.
"If we are going to really affect people's lives and the housing crisis for young people then we need to be in it to change the outcomes … sometimes (people) only need a little bit of a break," the mission's general manager of community development, Sally James, told The Sunday Age.
Netty Horton, community services general manager for the St Vincent de Paul Society — which has land and property in Victoria worth at least $57 million — said the charity hoped it could negotiate with the Catholic Church, one of the state's largest land holders, and others, for surplus land.
UnitingCare Victoria and Tasmania director Raoul Spackman-Williams said congregations had already singled out properties in Dandenong, Prahran, Box Hill, Croydon and a large site in Ballarat as potential housing areas.
"Where they are will very much depend on the communities' needs," he said, adding that the Uniting Church's surplus land mainly came from the merger of the Congregational, Methodist and Presbyterian churches in 1977. The church now has 2100 properties in Victoria and Tasmania.
Mr Spackman-Williams said the main hurdle facing the housing plan was a legislative clause that gave the State Government claim to all the assets of a housing association if it was wound up. Ms Horton said several churches had discussed their concerns aboutthis clause with lawyers and the Office of Housing.
Under legislation, housing associations must charge enough rent to cover costs as well as fund further home building projects. While Council to Homeless Persons chief executive Deb Tsorbaris welcomed more affordable housing options, she said the imperative on housing associations to "grow" meant rents would probably not be as cheap as they could be without a profit incentive. Figures for 2005-06 showed 36,600 people in Victoria used homeless assistance services.
The Salvation Army wants to free up its small holdings, as well as buy and develop other sites, according to social program secretary Major David Eldridge.
The army's Captain Colin Abram said it was devastating to have to turn people away. "I definitely believe that it is God's work (to use the land)," he said.
A spokesman for Housing Minister Richard Wynne said the wind-up provisions were to protect government assets, but no housing associations had been wound up. The Government paid about 75% of housing association project costs.
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