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Tackling hardship and homelessness
1 April 2019
When community housing provider
HomeGround Real Estate Sydney
in April 2018 with the financial backing of the City of Sydney, PwC Australia, the REA Group and several philanthropic donors, the bar was set high for Australia’s first not-for-profit real estate agency setting up in NSW.
HomeGround Real Estate was first established by Launch Housing in Melbourne in 2014. Almost a year after it's Sydney launch, HomeGround Sydney is an agency with a social purpose, driving investment in and supply of affordable housing in the challenging Sydney market.
"Sydney is the toughest housing market in Australia. Only one per cent of properties across the city are affordable for people on low incomes," says Terry Livingstone, HomeGround Sydney’s Manager and Licensee-in-charged.
"We identified a real gap in the market for a not-for-profit agency dedicated to providing affordable housing options by generating income from property management. We’re pleased to say we’re gaining traction and are well on the way to reaching our target of 190 properties under management in our first year of operation.
“These include a combination of studios and one to three-bedroom apartments, which currently provide more than 66 families, couples and individuals a well-needed roof over their heads."
Business as usual
Livingstone’s growing portfolio has led to the appointment of a new full-time property manager and, together with his trust accountant, he manages HomeGround Sydney from Bridge Housing’s new offices in Haymarket.
Although they benefit from the strategic and financial oversight of an established community housing provider, day-to-day HomeGround Sydney operates like any other real estate agency.
"We provide professional property management services to landlords and tenants, with all the usual competencies, frameworks and risk assurances. What makes us different is that we reinvest our profits back into affordable housing solutions," Livingstone says.
HomeGround Sydney offers three distinctive models for property owners and investors. Landlords can list their properties with HomeGround Sydney at the going market rate with all management fees directed back into the community. Or they can offer their properties at below market rate and claim the gap as a tax deduction.
"We’re the only real estate agency in NSW with an ATO tax ruling that means if a landlord is happy to reduce the weekly rent, whether it’s by $5 or $50, they’re able to make a claim at the end of the year," says Livingstone.
Generous philanthropists can also donate the use of their properties in the short, medium or long-term without seeking an income return on their investment.
"We offer a real bridge out of rental stress and possible homelessness into somewhere people can afford to live," continues Livingstone. "The generosity of Sydney’s landlords, investors and philanthropists is making this a reality for so many individuals and families."
Affordable housing regulations
With the inclusion of affordable housing now a condition of new property development consents in Sydney under schemes such as the
State Environmental Planning Policy No 70
National Rental Affordability Scheme
, HomeGround Sydney is also partnering with developers and other real estate agents to manage these properties for them.
"Most real estate agents and developers are pretty reluctant to become community housing providers as it's quite a complex registration process with additional governance requirements," Livingstone explains. "In short, it’s not a step taken lightly. If they partner with us, however, we retain Bridge Housing’s not-for-profit, tier-one community housing status, which enables us to operate in this space and fill the gap."
Broad spectrum of tenants
HomeGround Sydney advertises on portals like any other real estate agency, but the affordable housing tenants applying need to meet strict housing affordability criteria.
"There are income bands and other forms of assessment to determine eligibility, but the general rule is tenants are not allowed to spend more than 30 per cent of their income on rent to make sure they still have money for household living and basic needs," says Livingstone.
"Because some suburbs in Sydney are now so expensive, you can be on a middle income and qualify for affordable housing simply because the cost of rent is just so high. So the eligibility criteria really covers a broad spectrum of people."
For Livingstone, a successful real estate agent who has worked for some of Australia’s leading real estate brands, the transition into a not-for-profit agency has been extremely rewarding. He’s now focused on growing his portfolio and offering a rental lifeline to the community of Sydney.
"I've always loved the property industry and having been in sales, property management and strata management, I can honestly say I feel like I'm doing something I can be proud of," he says. "It's never been about the personal financial gain for me. It's about being able to assist and guide people with their dreams, whether it's home ownership or securing a rental property."
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