Preserving and Offsetting the Loss of Low-Cost Housing

When lower-value housing markets experience increased demand, perhaps as prices rise in neighbouring localities, or preferences change, there is a strong likelihood that lower-income renters will be displaced. Pressures might arise from government-led renewal processes, or through market-driven gentrification. When the available housing stock is well located, there is also a risk that it may be converted to short-term tourist accommodation. For instance, the rise of ‘Airbnb’ has been associated with the displacement of permanent accommodation in cities such as New York and San Francisco, exacerbating the shortage of low-cost rental supply (New York State Attorney General 2014). Lower-cost single-r oom occupancy (‘rooming’ or ‘boarding’ houses) has long been under pressure for conversion to higher-end apartments or for tourist hostel accommodation (Smith 2003; Nenno 1991). Similar issues affect coastal resort areas where lower-priced homes and caravan parks also experience increased pressure for tourism uses (Bunce 2010).

Strategies to preserve sources of low-cost rental accommodation must balance the need to sustain lower-priced housing opportunities with concern for the quality and safety of this stock. Further, the overarching economic or other benefits arising from reinvestment in a particular area usually outweigh the costs associated with mitigating impacts for lower- income groups. Approaches might focus on a particular housing type under pressure (e.g. ‘rooming houses’ or ‘single-room occupancy accommodation’), or on the incremental processes of urban change and redevelopment that cumulatively reduce low-cost housing opportunities. Such levers might seek to offset demolition, change of use or redevelopment of identified low-cost housing (e.g. rooming houses, caravan parks, or low- cost rental flats meeting defined criteria), by imposing additional social impact criteria and requirements to ensure a proportion of affordable housing within the new development. Financial assistance for the rehousing of affected tenants might also be offered. In Australia, planning policy introduced by the state of NSW in the late 1980s continues to impose additional levies on the conversion of boarding houses and certain forms of low-cost rental accommodation (Gurran 2011).

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