Check out to the episode:

You can find the shownotes through this link.

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Are you interested in housing as economic infrastructure?

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Our summary today works with the article titled Why affordable, social and public housing must be redefined as economic infrastructure from 2024 by Robert Pradolin, published by the Housing All Australians.

This is a great preparation to our next interview with Robert Pradolin in episode 264 talking about affordable housing.

Since we are investigating the future of cities, I thought it would be interesting to see affordable housing in a different light than “it would be nice”. This article presents affordable, social and public housing as essential economic infrastructure.

[intro music]

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Welcome to today’s What is The Future For Cities podcast and its Research episode; my name is Fanni, and today I will introduce a research paper by summarising it. The episode really is just a short summary of the original paper, and, in case it is interesting enough, I would encourage everyone to check out the whole paper. Stay tuned until because I will give you the 3 most important things and some questions which would be interesting to discuss.

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Australia is facing a severe housing crisis, affecting both the general affordability of homes and the availability of housing for essential workers such as police officers, nurses, and teachers, as well as for socially disadvantaged groups. Traditionally, the conversation around affordable and public housing has been framed as a social issue. However, it is increasingly crucial to recognize this crisis as an economic challenge that impacts the long-term well-being of our society. By providing adequate housing for all Australians, we can prevent costly consequences in areas like health, justice, and welfare dependency.

The current shortage of affordable and social housing is staggering, with over 500,000 new dwellings needed across the country. This deficit has been estimated to cost $290 billion, a figure too large for the government to address alone. To tackle this challenge, it is essential to engage the private sector and explore innovative financing solutions that can support the required investment. This presents both a significant challenge and an opportunity, particularly for industries like timber prefabrication, which can play a pivotal role in addressing the housing shortfall.

Elevating the conversation about affordable and social housing to a national priority is vital. Australians must understand the long-term economic costs and social implications of failing to address this housing crisis. The solution requires a sustained commitment to building additional housing over several decades, necessitating new approaches in financing, development, and construction that can deliver this housing at scale without driving up costs. One promising method is the mainstream adoption of timber prefabrication, which has already proven effective in reducing construction costs and timeframes, as demonstrated by Frasers Property Australia at The Green in Melbourne.

In cities like New York, Chicago, and San Francisco, both political sides recognize the economic benefits of investing in affordable housing for key workers. These investments bring workers closer to their jobs, reduce the overall costs of government services, create jobs, and contribute to a happier, more productive society. The situation in Australia is no different. Providing well-placed, affordable housing for key workers and public housing near essential infrastructure not only makes good business sense but also addresses the pressing social issues of crime, suicide, domestic violence, and depression, all of which have significant economic consequences.

The economic case for building more affordable and social housing in Australia is clear. A 2022 report by SGS Economics estimated that the failure to provide sufficient housing could cost Australian taxpayers an additional $25 billion annually by 2032. Moreover, the report highlighted a cost-benefit ratio of 2:1 for creating housing that mitigates long-term government expenses. The scale of the housing shortfall is so significant that it requires a fundamental shift in how we think about the issue and its social and economic impacts. New and innovative funding mechanisms are needed to minimize the short-term impact on government budgets, making it crucial to involve private capital in the solution.

To effectively address the housing crisis, we must begin to view affordable, public, and social housing as essential economic infrastructure, similar to roads, tunnels, hospitals, and schools that receive government subsidies. This recognition would unlock private capital and make it economically viable to invest in this type of housing, ensuring the long-term economic stability of our cities and society.

Australia’s housing crisis demands immediate action and innovative thinking. Recognizing affordable, social, and public housing as critical economic infrastructure is key to securing the nation’s future prosperity. By uniting business leaders and stakeholders, we can create a more compassionate and economically prosperous Australia, ensuring that we leave a better future for our grandchildren. The time to act is now, and the stakes could not be higher.

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What was the most interesting part for you? What questions did arise for you? Do you have any follow up question? Let me know on Twitter at WTF4Cities or on the wtf4cities.com website where the transcripts and show notes are available! Additionally, I will highly appreciate if you consider subscribing to the podcast or on the website. I hope this was an interesting paper for you as well, and thanks for tuning in!

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Finally, as the most important things, I would like to highlight 3 aspects:

1. Australia’s housing crisis must be recognized as an economic issue, not just a social one.
2. Investing in affordable, social, and public housing is crucial for the nation’s long-term prosperity.
3. Private sector involvement and innovative financing are essential to solving the housing shortage that government alone cannot address.

Additionally, it would be great to talk about the following questions:

1. In what ways does the housing shortage impact Australia’s, or for that matter any country’s long-term economic stability?
2. How can we shift the national conversation to view affordable housing as essential economic infrastructure?
3. How can we ensure that investments in affordable housing benefit both society and the economy?

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