National Housing Finance and Investment Corporation (NHFIC) is helping transform Greater Sydney communities

26 April 2022

Election campaigns are an opportune time to think about not only what we want from government but also a time to reflect on what is working well.

Australian government backing of investment in social and affordable housing through the National Housing Finance and Investment Corporation (NHFIC) has been a gamechanger, helping to lower the cost of finance for providers.

It’s thanks to the efforts of NHFIC in recent years that SGCH has been able to bring together the private capital from institutional investors and the sector capability needed to revitalise neighbourhoods across Greater Sydney, putting more keys in doors for people on low and moderate incomes.

By reducing the cost of borrowing NHFIC is helping to position affordable housing as crucial social infrastructure to an expanded pool of private investors looking to take advantage of secure long-term investments that deliver solid financial and social returns.

It’s policy mechanisms such as this that are helping to tackle rental market pressures and laying the foundations for a much needed transformation of the way new social and affordable housing is designed, funded, and managed.

NHFIC is proving to be an important part of the mix in efforts to attract the substantial recapitalisation needed to fix our broken social and affordable housing system so that it is fit for purpose, able to withstand private rental market pressures, and capable of growing for the benefit of future generations.  

The community housing sector is also benefiting from a growing global trend of institutions seeking opportunities to invest in projects that support environmental, social and governance (ESG) outcomes. For example, all three NHFIC bonds in 2020–21 were at least two times oversubscribed and had the highest allocation to international investors to date.

It’s this prospect of longer-term public and private investment that supports our development pipeline, ensuring our customers can live in great places that are energy efficient and are close to jobs, education, and lifestyle opportunities.

NHFIC raises money by issuing social bonds (the NHFIC affordable housing bond aggregator) to investors and then lends the money raised to community housing providers, at lower interest rates and on better terms than banks. As a result, community housing providers are now able to attract larger scale private sector investment.

SGCH has $475 million in loan facilities that have refinanced debt on existing homes and supported delivery of brand new, safe, affordable and energy efficient homes including Ironbark Avenue Casula, 11 Gibbons Street Redfern, Foyer Central and City Road at Chippendale, and Flowerdale Road in Liverpool.