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2 + 1 Plan to Boost Housing

Pacific Link Housing has developed an innovative plan to increase the supply of community and social housing at no additional cost to the NSW Government. Instead, the plan will add to the value of the NSW Government’s current housing assets.

If accepted, the Pacific Link plan will see it fund the addition of secondary dwellings – commonly called granny flats – to around 100 existing properties owned by Housing throughout the Central Coast and Lower Hunter.

Detailed costings show the plan is feasible if government grants Pacific Link long-term management leases on two existing properties for each new home added under scheme.

If the government transfers 200 properties to Pacific Link to manage under 30-year leases, Pacific Link will progressively add a secondary dwelling to half of them – adding 100 new homes.

The ‘2 + 1’ plan -  as it’s known - would allow government to retain ownership of the existing homes it provides and the new homes added by Pacific Link.

Far from increasing costs to Government, the 2 for 1 plan will:

  • Remove the cost of managing and maintaining 200 homes for 30 years,
  • Provide 100 additional new homes
  • Increase the overall value of the government’s housing assets through the addition of the new homes.

The plan’s author, Pacific Link CEO Keith Gavin, says the 2 + 1 plan relies on Pacific Link obtaining 30-year leases on the properties provided by government.

“Under current regulations, the NSW Government is not permitted to raise debt funding against the value of its housing assets.  As a non-government, not-for-profit social enterprise, Pacific Link is able to raise funding – so what we’re simply saying is ‘please lend us 200 properties for 30 years and we’ll give you 300 properties back at the end of the period'.

“It’s a win/win plan that provides an alternate way of increasing housing provision at a time when constrained public funding makes it very hard for governments to meet future needs.”

The plan is fully costed and documented in a detailed prospectus provided to government by Pacific Link. In the prospectus, Pacific Link points out that:

  • Secondary dwellings allow for the modest densification of neighbourhoods without significant visual intrusion on the existing streetscape.
  • Their delivery in the social housing sector is easier than in the private sector as there is no need to split titles.
  • The addition of secondary dwellings will allow some social housing residents to move from under-occupied larger properties, freeing up larger homes.
  • There is a particularly urgent need for new housing on the Central Coast, which has significantly fewer homes set aside for social housing than the average for NSW.
  • Pacific Link will use the procurement process to give young people work experience which will help reduce welfare dependence and reduce overall costs to government.

“The funding model is complete and robust,” said Keith Gavin. “Prices for delivering secondary dwellings can and will be fixed in advance – and bulk discounts will result for a project of this scale.

The proposal has received wide-spread support, and Pacific Link Housing is now engaged in detailed discussions with government.

“The concept makes the most of existing government assets to leverage the development of housing in a region where the wait for all forms of community and social housing now extends beyond 10 years,” said Keith Gavin.

IMAGE: Pacific Link Housing has a plan to add ‘granny flats’ to existing housing blocks.