UP TO 1.5 million low- and middle-income households will be eligible for the Federal Government's rent affordability scheme, but the final number who benefit will depend on investor interest to build the properties.
The scheme works by giving tax incentives to developers and not-for-profit housing groups who build and lease rental accommodation at 20 per cent below the market rate.
Launching the final version of the scheme yesterday - one of Labor's key election pledges on housing affordability - the Federal Government revealed it has lifted eligible income thresholds for different household types to potentially benefit an extra 600,000 households.
The Housing Minister, Tanya Plibersek, said this would open up the scheme to low- and middle-income workers in a variety of industry sectors, including child-care workers, hairdressers, clerical workers and retail and transport employees.
A single person earning up to $39,351 would be eligible to live in one of the properties, as would a couple with a combined income of up to $55,991 and no, or only one, child. The more children you have, the further the income test rises, topping out at $82,855 for a household with three or more children.
The chairman of the National Affordable Housing Summit, Julian Disney, welcomed the expanded eligibility criteria, saying it would make the scheme more attractive for investors.
Including middle-income families would also improve the "social mix" of potential developments, avoiding clusters of extreme disadvantage - as had tended to happen with highly targeted public housing developments.
Mr Disney said the scheme would put downward pressure not just on the properties offered for low rent, but also on all rents thanks to an increased supply of properties and competition from the cheaper rents.
The chairman of National Shelter, Adrian Pisarski, said more incentives from state governments would be required to ensure investment could take place in more expensive areas. "One of the dilemmas for Sydney is that to make the scheme work in a reasonable distance from the CBD, the state government would need to provide additional resources," he said.
Applications for an initial round of grants for investors closes on September 4.