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Can real estate lead the rebellion against homelessness?

By Kyle Robbins
12 September 2022 | 19 minute read
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Julie Collins, Minister for Housing and Minister for Homelessness, recently labelled Australia’s homelessness crisis as “unacceptable”.

On census night in 2016, the Australian Bureau of Statistics (ABS) painted the scope of the crisis, detailing how there were approximately 116,000 people without a home nationwide. Conditions since then — notably the COVID-19 pandemic and the knock-on effects surrounding this once-in-a-lifetime health and economic crisis — mean that figure is likely to have stretched out in the six years since its recording.

Unlike common perceptions, one isn’t considered homeless if they are sleeping rough on the street. The bureau’s statistical definition dictates that when a person does not have a suitable accommodation alternative, they are considered homeless [or] if their current living arrangement:

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  • Is in a dwelling that is inadequate;
  • Has no tenure, or if their initial tenure is short and not extendable; or
  • Does not allow them to have control of, and access to space for social relations.

Plenty of solutions have been presented to combat the increasing rate of homelessness in Australia. Earlier this year, as part of their election campaign, the Labor government announced a $10 billion Housing Australia Future Fund that Prime Minister Anthony Albanese explained would build 30,000 new social and affordable housing properties in its first five years — creating thousands of jobs in the process.

Yet, this plan has been slammed, particularly by the Australian House and Urban Research Institute (AHURI), which revealed this would only account for 3 per cent of the social housing requirements needed, not wanted, by 2032. This criticism is based on the body’s calculations that the country would need 671,000 public houses in the next decade to “solve homelessness and meet demand”.

The Prime Minister also announced at the recent Jobs and Skills Summit in Canberra plans to make $575 million available within the National Housing Infrastructure Facility to invest in social and affordable housing and attract investment from private capital into the social housing effort.

Outside of federal government initiatives, there have been a number of state-based schemes implemented recently, with pushes to improve social housing stock underway in Victoria — where a $515 million investment is underway — and Western Australia — with a Perth build-to-rent project nearing commencement a positive sign in a collective effort to reduce homelessness.

However, despite these governmental efforts to combat the crisis, Mission Australia executive Ben Carblis stated that “everyone knows that social and affordable homes are scarce in our country which means too many people are left high and dry when seeking a safe, secure and affordable home”.

“The situation has meant people and families have to decide between paying for food, bills, transport, the rent or medication and forgoing other essentials,” Mr Carblis said. 

“Simply put, we need more homes — in cities, suburban, regional and rural areas — that address the critical shortage of social and affordable homes and the resulting homelessness crisis that we’re facing.”

Mr Carblis’ arguments are supported by a report released in July by Homelessness Australia titled A Plan to End Homelessness. This detailed that in the time between June 2021 and the report’s publication, rents had increased by 13.2 per cent, ballooning out to 25 per cent in some parts of the country. 

It outlined how financial difficulties, the housing crisis and other affordability and housing-related issues were the primary reasons presented by 50 per cent of people who presented themselves at homelessness services, culminating in 109,207 people requesting long-term housing from a homelessness service in 2020–21.

Unfortunately, just 3.4 per cent of people could be helped directly, while 26.9 per cent were referred to housing suppliers, meaning 76,177 people missed out. Moreover, the report highlighted research released by Everybody’s Home that revealed that “a lack of affordable housing means an estimated 7,690 women fleeing domestic and family violence return to perpetrators each year because they have nowhere to go, and another 9,000 become homeless after leaving a violent home”.

Add to this the severely undersupplied rental market and subsequent plummet in vacancy rates, and it is easy to see why homelessness has become such a prevalent issue in Australian society. 

The issue of tackling the homeless crisis has been traditionally viewed as a public problem that requires public solutions. But, there have been several privately funded and facilitated programs that have sprung up around Australia aiming to combat the homelessness crisis. 

One such program is the Terra Firma program ignited by Harcourts Packham in South Australia — which lays the platform for private entry, particularly by real estate industry operators, into the homelessness fight.

According to the franchise’s principal James Packham, the project — which offers up to 12 weeks of accommodation to individuals 45-and-over (singles or couples) battling homelessness in a renovated backpackers hostel — was born from a desire to “square off with a really big problem and champion [a] solution and a have a larger, more significant impact on something”.

“We’ve always been fairly community minded and philanthropic,” Mr Packham explained. “But up until this project, we spread ourselves broadly. We just contributed money and effort to a lot of different charities all over the place, but it lacked engagement.

“We’d just send everybody a little money and that was it. You didn’t hear from people again for another year until it was time to pay again.”

In May 2021, his agency purchased the site that would become Terra Firma, and the journey began inspired by the mission statement: “Working together, giving hope to prevent and end homelessness.”

A brochure for the project reads: “Whilst the end goal is to work alongside individuals to prevent and end their homelessness experience, this partnership initiative is committed to delivering the following outcomes:

  • Offering a sense of ‘home’ from the moment the person enters Terra Firma.
  • Improved health outcomes for the client group, including access to primary health and dental care services. 
  • Improved housing outcomes, including a client referral pathway to private rental options via Harcourts Packham.
  • Improved access to employment, education and training opportunities 
  • Connection or establishment of social and, or family connections to reduce social isolation and exclusion.”

Mr Packham learnt the extent of the issue, which would go on to inform and guide Terra Firma during his research for the project — which involved spending time undercover at homeless shelters and motels around Adelaide to get a scope of the problem.

“The problem of homelessness is far greater than what people realise if they’re basing it just on that homeless man you see sleeping on the footpath,” he said.

What you start to learn is that those people that you see sleeping rough, they only make up 7 per cent of people who would be classified as homelessness, because the rest of them are quite hidden away, remaining in households where they have a roof over their head, but it’s unsafe. Or they’re sleeping in cars or couch surfing or travelling from place to place.”

Data released by the ABS revealed that approximately 44 per cent of individuals experiencing homelessness on census night 2016 lived in severely crowded dwellings. This data also revealed some of the primary factors forcing individuals into homelessness, with 116,200 people accessing specialist homelessness services during the 2020–21 financial year doing so due to family or domestic violence.

Mr Packham noted that when people are in these circumstances, “they don’t take the home with them”, adding that this was a primary motivator behind his decision to establish a divert program.

Divert programs save people from experiencing homelessness before they have a chance to enter it, which he felt was pertinent given the rise in individuals entering homelessness for affordability reasons rather than domestic violence or substance abuse — Australian houses rose at their quickest rate in 20 years during the course of the COVID pandemic.

That’s where Terra Firma steps in. The program invites individuals to stay at the location for up to 12 weeks, simultaneously providing all residents with accommodation and a caseworker, who utilises their knowledge of the available support networks to broker a pathway out of homelessness. 

“The idea is that at the end of the 12 weeks we don’t send them back out onto the street, we send them on to some more realistic long term housing solution.

“One of the things that we are doing is my senior property managers actually go there and hold classes to teach the residents of Terra Firma how to be successful as tenants and applicants in the private rental market.

“We teach them about getting references, keeping a property correctly, we teach them about bonds and applications and everything like that, so that we can actually help them rejoin the private rental market,” he said.

Mr Packham explained that these programs are well received by the residents of Terra Firma, especially with the tightening rental market forcing property managers to sift through 20 to 50 applications per property. He outlined how the educational programs remove friction points that become the barriers to long-term permanent residency. 

This, he elaborated, is particularly true in the case of the 60-plus age bracket, the fastest-growing demographic entering homelessness, a trend that has risen due to a number of factors, including an inability to navigate technology well enough to apply for properties, as well as having a fixed — or no — income, such as pension, that is unable to combat rising costs.

Described as “shockingly cost effective compared to other models”, Harcourts Packham’s Terra Firma’s construction was funded from the agency’s back pocket, outlaying millions of dollars to provide a two-storey 11-bedroom facility that boasts six showers and six toilets, wireless internet, in addition, all the relevant connections and services, pest and solar maintenance, fire protection and cleaning and a host of additional amenities that create a comfortable environment for its residents.

He believes that providing such services to the project’s residents is not a service to them, but also to the wider community.

“When someone’s homeless they find it difficult to achieve the baseline requirements to contribute to society. The idea of somebody just getting a job and resolving their situation is actually really not realistic. If you want somebody to be able to participate and earn money, go to work and all those sorts of things, you kind of need to help them achieve that baseline requirement, which is food, shelter, safety,” Mr Packham explained. 

“All those things that until someone’s got those things it’s unlikely that they’ll really be able to participate. Not only is it better for them, it’s actually better for society to get a person back on their feet.”

The project’s upkeep is maintained through an alliance between Harcourts Packham and the Toward Home Alliance, specifically, Lutheran Care, which, in Mr Packham’s words, provides “the boots on ground, all the case workers and the concierges, the people physically there to support the residents”.

“They’re basically responsible for sourcing and placing all of those residents because they’re the ones that have a really clear line of sight for people that need the help,” Mr Packham said.

He added that the organisation accesses funds from a variety of sources — including “some charitable, some government [and] allowances made available for the residents themselves that can be directed into providing some of the cost of them being there”.

It is an alliance that has gained international recognition, but barely any at a domestic level, despite the fact it is the first private project of its kind in South Australia, paving the way for future schemes to be implemented by other stakeholders in the corporate sector. 

It’s worth noting that Mr Packham embarked down this path without any approval for his ideas, a factor he believes was crucial in the project’s progression.

He acknowledged that there are challenges presented to anyone looking to embark on a similar endeavour. Finance is a major one; Mr Packham admits he poured millions of his own money and plenty of resources into the project.

Another is a pervasive attitude towards combating homelessness, with Mr Packham expressing the belief that the private sector “feels like they almost need a permission note to become participants”. 

Acknowledging that for so long, homelessness has been in the wheelhouse of not-for-profit and the government, he said many “feel like it’s not their space to get involved in”.

Proactivity is one way to circumvent these obstacles. He is the first to admit that if Terra Firma had had to wait for people to approve his idea, “we would be no further along today”.

Mr Packham believes that the private sector should be brought into the conversation. 

Not only is it okay for them to take an interest in combating homelessness, but he also said they need to be alerted that “it’s okay to enter into conversations and participate in this space”. 

If that occurs, Mr Packham sees ample opportunity for similar cost-effective models to be established — improving the likelihood of diversion from homelessness for Australians both now, and into the future. 

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