Case study: The big vision
Kerrin Benson is the CEO of the Multicultural Development Association (MDA), a not-for-profit organisation based in Brisbane which provides settlement services and support to people seeking asylum and people from refugee backgrounds. She has a “big vision” for providing an affordable housing to MDA’s clients.
“The primary options that exist at the moment are in the private market,” she says. “And that’s really precarious for anyone but particularly for refugees because of the added barriers they face in terms of affordability and their capacity to manage a tenancy. So I think there need to be some other options.
“Here at MDA, we spent $5.5 million on housing [in 2012-13]. And we probably do about 10% of the work in settling refugees that there is here nationally. So the Australian Government would be spending millions and millions of dollars on housing for humanitarian entrants, with the vast majority of it going into private market solutions. I think there could be a different way of investing that money. Instead of ploughing it into the private sector, we could be ploughing it into a social enterprise initiative.”
MDA is working to make this vision a reality through developing a model for a community land trust, a not-for-profit organisation which owns and develops real estate for the benefit of the community, in particular through providing affordable housing in perpetuity.
Community land trusts provide a range of housing options with different forms of tenure at below-market rates, allowing people who may otherwise be locked out of the private market to access stable and affordable housing.
Kerrin outlines how it would work.
We’re envisaging a ‘staircased’ model. So, people might start out at a reception centre, then rent a house in the trust at an affordable, below-market rate. And then when they get a job, they might say ‘actually, I want to stay in this house but I’d like to buy a 20% share’. And then when their partner gets a job, they might say, ‘actually, can we buy a 40% share now?’ And then their kids get a job, they might say, ‘actually, we think we’re ready for home ownership, can we buy the whole house?’ That’s the big vision for us: to provide long term, sustainable housing for refugees and people seeking asylum that’s affordable, that has some home ownership component for them at the end, that doesn’t see them having to move a lot.
The model would also include a “sweat equity” component, whereby residents could earn equity in a property through assisting with its construction. “So, you might get together with some friends and make a contribution to building your house,” Kerrin explains. “For that labour component, you might get a 5% equity in the house, or a 10% equity in the house if you worked hard, and then you’d rent the rest. And then over time, as your family came out and you added more equity, you could buy that house.”
But it doesn’t stop there. “We can also see the spin offs of that in terms of potential employment pathway programs,” she says
We work with a lot of people who have experience in the construction industry. Through a sweat equity program, you might build some relationships, get some mentoring or get an apprenticeship.
Kerrin sees a big advantage in working with people from refugee backgrounds to develop this “sweat equity” model. “In Australia, we’re not a very collective community. If you asked me to come over every weekend to help build your house, I’d be thinking: ‘Really? I don’t think so! What’s in it for me?’” she laughs.
But of course, many of the communities we work with have very different thinking to that. Everybody would keep helping each other until everybody had a house. So those collective cultures are, I think, really well suited to these kind of sweat equity models. Because it might not just be about the sweat that you bring but might be about the sweat that you and all your friends bring.
MDA has set up a reference group for the project and work is underway on a feasibility study to develop a sustainable model for the community land trust. There are still many challenges to be overcome before this big vision can become a reality, not least of which is sourcing affordable land suitable for property development.
But Kerrin is committed to making it work. “Pretty much everyone we’ve spoken to about it has been really excited, because it ticks a lot of boxes,” she says.
It’s people making a contribution to their own housing, it’s addressing affordability, it’s people working together, it’s creating a sense of community. It’s got a lot going for it.