In all, the government will build 80,000 new dwellings as part of the initiative.
A copy of the ALP statement is below:
The Australian Government is encouraging large scale investment in affordable housing under the third round of the National Rental Affordability Scheme.
The Scheme aims to deliver 50,000 new properties by 2012, which will then be rented out at a minimum 20 per cent below market rate.
More than 10,500 incentives have been offered to successful applicants under in the first two rounds.
Round three is a special call to institutional investors, who can deliver stock on a larger scale, as has occurred in similar schemes in the United States.
Round three is different to previous rounds because applications are being sought from institutional investors wanting to finance residential building in parcels of at least 1,000 NRAS incentives. These incentives can be spread across multiple locations.
This is an excellent opportunity for institutional investors. The National Rental Affordability Scheme enhances potential returns generated by residential property investments.
It also helps bring much needed affordable rental housing on line for people on low to moderate incomes, targeting key workers and their families, like our police, nurses and teachers.
The Scheme provides annual income-tax-free incentives to developers of $8,672 per home, indexed to the rental component of the CPI for a 10 year period.
The level of interest from the corporate sector was extremely encouraging in round two and we expect the sector to continue to take advantage of this investment opportunity.
The return on residential property – according to independent research by Ernst and Young – has proven a better investment than other options, such as office, industrial or retail property over the 10 years to December 2008.
The Australian Government is increasing the stock of social and affordable housing by 80,000 dwellings – 50, 000 through the National Rental Affordability Scheme and 30,000 social housing dwellings.
The National Rental Affordability Scheme is another example of how the Australian Government is working to boost housing stock and stimulate the local building industry during the global recession.
It generates jobs for our builders and tradespeople, as each dwelling needs to be newly constructed.
The third round of Scheme will have a rolling approval process to ensure proposals received early can be processed as soon as possible. For more information about the application process, please visit www.fahcsia.gov.au and follow the links to housing.