Essential city workers who cannot afford to live in it

Sydney Morning Herald
Josephine Tovey

October 16, 2010

JENNY OWEN was born in Alexandria, but the Ambulance Service worker can only afford to live there now thanks to affordable housing.

The single mother is one of thousands of key workers – public sector employees who provide essential services – in Sydney priced out of the private market by rising house prices and rents.

She and her children lived with her sister in Mascot until she secured one of the city’s few affordable housing units in Zetland five years ago.


The apartments, which are owned by a community housing provider and are let for at least 20 per cent below market value, are manna for those lucky enough to secure them. ”It’s like what public housing used to be … for working families,” she said.

The average cost of a privately rented two-bedroom apartment in the City of Sydney – $600 a week – is now well out of reach for most essential service workers.

Figures from the Fairfax-owned Australian Property Monitors, published yesterday, showed the median asking rent for units in Sydney was $100 more than in Melbourne or Brisbane.

”It’s a problem in almost all global cities – housing markets are running high and that drives out the people you need to run a city,” said Peter Phibbs, an urban planner and academic.

Affordable housing is touted by government as a key solution to the rental crisis. But if the harbour city punches above its weight in terms of rental growth, it is lagging in affordable housing. Less than 6 per cent of recent federal tax incentives for affordable housing went to Sydney.

The effects of the rental crisis can be seen in the staff shortages of core services and industries. At the Rocks Local Area Command, more than half the police officers live more than 40 kilometres away, many commuting from the Central Coast.

Sergeant Duncan Gray, of the NSW Police Association, said officers usually sought transfers away from the city when their initial three-year placement was up.

The private sector is also struggling to find employees. Hospitality and food preparation workers are those most likely to be unable to afford housing in Sydney, according to a 2006 study, followed by hairdressers, sales assistants, receptionists, carers and cleaners.

According to Restaurant & Catering NSW, Sydney lacks about 2000 kitchen, and waiting staff and rental affordability is central to that problem.

Policies tackling the issue had been helpful, said Professor Phibbs, but the problem was scale. ”A lot of the programs are quite small, and the problem is huge.”

The biggest initiative of recent years was the Rudd government’s National Rental Affordability Scheme, which provides tax incentives for affordable housing.

Last year the NSW government introduced the Affordable Housing State Environmental Planning Policy, which relaxed planning regulations for buildings that contained affordable housing and encourages alternative forms of low-cost accommodation such as granny flats.

The City of Sydney set a target of 7.5 per cent affordable housing by 2030.

But of the 15,279 National Rental Affordability Scheme incentives awarded since it began, in only 14 per cent cases, or 2138, have the beneficiaries been in NSW. Of those, 799 were in Sydney. There were twice as many beneficiaries in Victoria as in NSW.

The Opposition spokesman on housing, Greg Pearce, said: ”It is a catastrophe and a disgrace that NSW has not taken up participation in that scheme in the way that they should.”

A spokesman for the Housing Minister, Frank Terenzini, said numbers were expected to pick up significantly in the next two rounds of incentives.

“As the NRAS funding incentive … is a flat rate it should be noted that NSW is structurally disadvantaged due to the higher land costs which make development projects less viable here.”

City West Housing is the only big affordable housing provider in the inner-city. Its stock continues to grow but places are scarce: at present there are about 1100 tenants living in 14 buildings across Ultimo, Pyrmont and the Green Square area, including the Zetland development where Ms Owen lives.

The not-for-profit organisation operates as both developer and manager of each of its properties. All buildings have a range of unit sizes let out for at least 25 per cent below the market value.

The group’s chief executive, Richard Perkins, said: ”We’re housing a lot of people who otherwise would not be able to live in the inner-city.”

The industries most affected by the affordability crisis say the response should not just be one of more affordable housing.

The Police Association has long advocated dormitory-style residences for police, as is the case in London. The secretary of Restaurant & Catering NSW, John Hart, said that having better transport connecting affordable residential areas of Sydney with the city at all hours of the day was vital.

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