An investment simply too compelling not to pursue
By Rob Pradolin - Housing All Australians
Welcome to the 10th article of our 12-part series which will attempt to explore the role that housing can and should play within Australian society and why it is important to our economy that we house all Australians, rich or poor.
This series intends to draw on a range of perspectives centred around housing and homelessness. We will hear a range of views from business, the not-for-profit sector and hopefully government, as to why they believe housing is an important social and economic building block for Australia’s future prosperity.
This month we have asked Mario Biasin, co-founder of Metricon Homes, Australia’s largest builder, to share his thoughts around why the objective around housing all Australians is important, especially given his early beginnings as a migrant to Australia …
I have been involved in the residential building industry for more than four decades, playing a part in building homes for tens of thousands of Australians through Metricon Homes. With my co-founder George Kline, we had a clear vision when we started building back in 1976 – we wanted to build good-quality homes for Australian families at an affordable price. Both of us, as child migrants to Australia, were acutely aware of the role a home plays in anchoring people, giving them a sense of belonging.
I can clearly remember the moment I first became aware of homelessness in Australia and how it impacts people in a devastating way. I was in Sydney for a work trip about 30 years ago and saw rough sleepers – a sight I’d not witnessed in Melbourne. This started my thinking about how the construction sector could contribute to alleviating housing distress.
When I reflect on how the property sector has changed over time, and the impacts on homelessness, the biggest change from my perspective has been the price of land relative to construction costs. Around 45 years ago, the price of building a home was around twice as much as the land. This has shifted dramatically. Land now costs at least 50 per cent more than the home in most capital cities, while land prices in regional areas have also increased yet perhaps not at the same rate. Relatively, construction costs have decreased. Numerous efficiencies in the construction process – from raw material prices to different building practices – have significantly reduced the cost of building a house. Land prices have increased disproportionately within this equation. This has resulted in home ownership and even fair rental prices being unattainable for many Australians.
Active participants in the home building sector have a role to play in the solutions. Government, industry, corporates, funders and the community sector have the capacity to collaborate to rethink how to provide more affordable housing solutions for the many people and families who are in desperate need of a safe roof over their heads. More intensive support for victims of domestic violence and those suffering mental health challenges will no doubt play a role too.
When I consider ways that our government, both state and national, could support better outcomes for those at risk of homelessness, two key opportunities come to mind. Firstly, government and councils own land in regional and metropolitan areas that is often well located and in close proximity to amenities. Could this land be better utilised as blended social, affordable and private market housing? Is some top-down urgency now warranted to drive activity in this area?
Secondly, the Victorian government has made an unprecedented commitment to enhancing social housing stock with the $5.3 billion Big Housing Build. Could this approach be used as a blueprint by other states to supercharge the development of social housing? Australian Housing and Urban Research Institute (AHURI) research reports that $1 invested in last-resort housing generates $2.70 of benefit to the community during the subsequent 20-year period, including health cost savings, improved quality of life and reduced crime costs, among others. Additional value would likely be achieved with secure tenure. Furthermore, as well as benefiting those in need of housing support, it would also stimulate economic activity and jobs. Is the business and social rationale of this investment simply too compelling not to pursue?
As a business, Metricon has stayed true to its original vision to provide quality homes for Australians from all walks of life. In 2018 we responded to the increasing challenge of homelessness by creating a division of our organisation purely focused on building social, affordable and accessible housing. Called EveryOne, this business unit is part of our social responsibility to the broader community. EveryOne taps into Metricon’s expertise to deliver well designed and competitively priced homes for government and community housing association clients, tailored for the tenants they support.
I’m proud to play a small role in unburdening more Australians from the stress of finding a safe and affordable home, one where they feel they belong. I also look forward to continuing the conversation about how we can collaborate to ensure that homelessness is significantly reduced.
I hope you found the above perspective by Mario interesting and insightful. While what was said may not align with our view of the world, we all need to listen and digest what is said by others in order to find common ground. This is why we are focusing on the fact that the provision of shelter is a fundamental human need (not human right) and without that need being met, we have unintended social and economic consequences that will span generations.
As I said in my first article, doing nothing is NOT AN OPTION! We need to act and we need to act now. All of us need to be part of the solution so please feel free to write to me with your thoughts: [email protected] •