Could Philip Lowe be onto something with his shared housing idea?

Steve Bevington  from Community Housing Limited considers a model for opening homes to renters that is mutually beneficial for owners and tenants.

Why not develop our own model of shared housing that matches appropriate tenants with older homeowners who would appreciate a small amount of income and some companionship?

We know that for many years now, older single women have been increasingly experiencing homelessness. A combination of working in low paid jobs and the lack of affordable housing supply has forced many older women who relied on the private rental market into inadequate housing and homelessness.

At the same time, we have an ageing population with many older Australians who live alone in their homes who may experience social isolation and loneliness. Every week, we hear about older people on pensions or low incomes being forced to vacate their homes due to increased rental costs.

Providing incentives for older homeowners who live alone to rent out spare rooms to people who are at risk of homelessness could be part of the solution we so desperately need right now.

The Australian Institute of Health and Welfare (AIHW) reports that 82%, or around 2.5 million, people aged 70 and older own their own homes. It also found that 26.4%, or 660,000, live alone. If even half of these people provided a room at affordable rent, we could offer housing to 330,000 people currently priced out of the rental market.

Not only would this provide much-needed housing in our communities, but it would also address social issues of loneliness and isolation among our older citizens. If a suitably matched person moved into a home where an older person needed some help with household chores, we could also allow more older people to stay in their family homes for longer.

At present, there are a couple of legislative stumbling blocks to providing this additional source of accommodation. Pensioners who provide lodging would fail the Centrelink assets test because they would be turning a proportion of their home into an investment property and, therefore, would lose their pension. Their Estate would also have to declare a capital gain on the same proportion for the time renting to a lodger. Very few pensioners who are homeowners offer a room to people in need of accommodation currently because of this quirk in Centrelink’s eligibility rules.

To move ahead with an idea like this, we would need to consider changing rules that govern pension payments to ensure older homeowners don’t lose their pension if they take in borders or renters. We would also need to ensure an exemption under the assets test and capital gains rules for pensioners who open their homes to people who are either experiencing homelessness or at risk of homelessness.

This would potentially bring hundreds of thousands of homes into the rental market immediately at no real cost to government because pensioners don’t provide accommodation anyway due to the risk to their pensions.

There are currently tax exemptions available to property investors who rent their homes out at below market rent under the National Rental Affordability Scheme, and these could be extended to those offering spare rooms at affordable rates.

The community housing sector is well-placed to assist in developing a model of shared housing that combats the housing crisis and loneliness among older Australians living alone. The success of such a model would require a partnership with government and a willingness to provide incentives to older homeowners who step up as part of solution to our serious housing crisis.

It doesn’t resolve the overall supply problem and the need to improve the availability of affordable housing, but it does provide another avenue to reducing homelessness and the isolation of our increasingly ageing population.