|LOW INCOME HOUSING|
In Australia the poor rarely get to own the house in which they live. The government provided houses they live in are many years old and have been paid for at least twice by the transient population that travels through them. Due to the so-called “Australian dream” of owning one‟s own home there is a stigma connected to being a low income earner who is renting a government house.
In essence, government rental schemes have become moneymaking revenue off the backs of the lowest income earners. Those living in Housing trust houses do not get that sense of ownership that is needed to encourage them to care for them in the way that an owner might. Why would they, when they feel it is a part of the poverty cycle where they cannot even leave a house they have lived in for a large portion of their lives to their children?
Other countries treat their poor in this regard differently. In India for example, slum redevelopment policies involve giving all occupants of slums a number on a piece of metal that represented the door number of a flat that was to be constructed in the area that they were living. They are then temporarily relocated to another area of the city to await the construction of government owned tenements. After 18 months they took their metal number to the housing authority office and were given a key and asked to sign for it. They could then move in and pay reasonably, according to income, low rent. What is particularly impressive about this system is that it was a rent to buy scheme that had them OWNING the flat they were paying for eventually. This is in stark contrast to how this government treats its low-income earners.
In Australia if the poor want to purchase a housing trust house they are given the option of going through a private real estate agent who gets the Government top dollar for their ageing house before being directed to another privately run organisation which will provide them a mortgage. If the poor cannot afford a loan for the entire amount a secondary loan is offered which silently accrues interest while the primary loan is paid, after that occurs they can then commence paying the secondary loan, which has by that time doubled. Other options are that the private mortgaging company can go as a silent partner paying half the cost of the house, thereby reducing the amount the poor have to pay. It is stipulated however that if the house is to be sold later the silent partner gets half the resale value.
As an alternative to this perpetual poverty trap we will represent low-income earners in a way that most governments do not by working towards a rent to buy scheme for the poor following the example set in India. Under this policy if a housing tenant could show through consistent rental payments for 3 years financial stability they are automatically eligible to purchase the house, with any money paid in rent prior to their eligibility, being taken off the cost of the house as they have already paid it. It is a scheme which would reduce the amount of damage done to Housing trust homes as pride of ownership would naturally generate care of property, as well as being a scheme which will have a natural flow on to the building industry; thereby boosting job creation.
Written by Craig Hendry
© 2009 Hendry, C. Adelaide, South Australia
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