Paul Scully, the Minister of Planning has announced that the New South Wales Government has identified a number of sites in Lake Macquarie and Wollongong to be the first sites to trial modular housing construction for social housing – Modular homes to deliver more social housing, sooner.
Three sites in Wollongong have been chosen to accommodate three modular social homes and four sites in Lake Macquarie will accommodate five modular social homes with completion expected by early 2025.
ABC Drive presenter Lindsay McDougall asked Home in Place Business and Public Affairs Manager Martin Kennedy about the announcement and the merits of the trial.
What do you make of this idea of using modular homes for social housing?
I think we should probably acknowledge that thinking outside the box is a good thing when it comes to social and affordable housing because the level of demand that we’re talking about here is absolutely off the charts. There are 60,000 households across the state on the social housing waiting list. Lake Macquarie, where I know some of these trial homes are going to be delivered, has around 1,300 households on the waiting list in that area alone.
Thinking outside the box, the modular housing trial is a good thing because the basic process of building homes hasn’t fundamentally changed much in the better part of a century. If you think about how much tech change there’s been in the way that cars are manufactured by comparison, it makes home building almost medieval by comparison. If modular housing delivers acceptable quality homes, faster and cheaper, that can only be a good thing.
Home in Place Business and Public Affairs Manager Martin KennedyThe thing to remember is that all these people on the waiting list have met all of the same eligibility criteria of the people who are currently in social housing. They just can't access it because we don't have enough. It's the only form of benefit that gets rationed in this way, and these are people, despite having met all the same eligibility criteria, are out there paying 30, 40, 50 percent of their income in rent in the private rental market. Anything that makes life easy for those people as quickly as possible is to be supported, in my view.
Tell us about the need for social housing in this country
Most experts agree that an additional almost half a million social and affordable dwellings are required across the country. In terms of New South Wales, social housing demand alone runs to approximately 60,000 households.
The economics of social housing are increasingly difficult. At the best of times, it’s difficult to make projects stack up, but higher interest rates and higher input costs in the form of building materials and labour have made it even tougher.
The cost of adding a single unit of housing in some parts of the state is over $700,000. It’s pretty hard to make projects stack up when you’re talking about a below market product that’s going to be rented out of below the market rate when the delivery costs are that high.
Anything that could potentially address some of those issues by providing a product that achieved a price point, I think is definitely worth looking into.
What about using Wollongong and Lake Macquarie? Are they good options for the trial?
The level of demand is right across the state. There’s no part of the state that is untouched by this issue.
Lake Macquarie and Wollongong are perhaps better options than Metropolitan Sydney as the land is a little bit more affordable. There are extensive waiting lists in both of those locations, so they are good places to start.
What sort of success indicators would you like to see from this trial?
Traditional construction generally has a pretty long lead time so if these homes can be, rolled out and have people living in them 20 percent quicker and cheaper as well, then that’s a good thing.
Whether it’s 10 percent cheaper, 20 percent cheaper, I’m not sure, as long as the build quality is there and we’re talking about an acceptable quality home.
I really don’t think there should be a precise number that defines success.
