The Australian government has tabled legislation to establish the Housing Finance and Investment Corporation as part of its housing affordability plan announced in the 2017–18 federal budget.
The government on Wednesday (14 February) introduced a bill in the House of Representatives to form the National Housing Finance and Investment Corporation (NHFIC), which would be designed to enhance access to affordable housing.
The NHFIC would perform two functions:
- Operate the National Housing Infrastructure Facility (HIF), a $1 billion facility that would finance “critical housing-related infrastructure” to speed up the planning process to increase housing supply through the provision of loans and grants and investments; and
- Operate an affordable housing bond aggregator, which will provide low-cost, longer-term finance to registered community housing providers.
Further, the NHFIC’s operations would be overseen by an independent, “skills-based”, government-appointed board that would serve terms of up to five years. The government has claimed that the board’s independence has been “enshrined” in the legislation through a provision that requires all financing and investment decisions to be made by the board.
Moreover, bonds issued by the NHFIC through the Bond Aggregator would be government-backed by a legislative guarantee to “drive the best price outcomes for consumers”.
The tabling of the NHFIC legislation follows the release of the exposure draft legislation that was opened to consultation on 12 January.
In its submission following the draft release, the Housing Industry Association (HIA) called for an increase to the $1 billion funding of the NHFIC.
“New home buyers are required to make significant upfront contributions to the funding of community infrastructure,” the HIA noted.
“As the cost of land increases, the tax take from these home buyer levies grows and, in the last decade, they have become one of the key barriers to delivering more affordable housing in all forms.”
The government has also put forward an Investment Mandate, designed to provide further information about the NHFIC. The draft of the Investment Mandate has also been open to public consultation.