Tier 1 and 2 Sector Performance Report 2020

The Registrar's key performance highlights

• The Tier 1 and 2 community housing sector is diverse and continues to remain viable for the foreseeable future.
• The majority of Tier 1 and 2 community housing providers (CHPs) continue to meet the Registrar's benchmark level of performance with no significant instance of non-compliance in the reporting period 1 July 2019 to 30 June 2020.
• The NSW Registrar is not reporting on asset property data in this report. A newly-developed property collection data system has yet to collect the data. We cannot provide a precise count on properties. We do expect there will be a significant increase from the approximately 47,000 properties reported last year.
• The response to the COVD-19 pandemic was the most significant event to affect CHPs during the reporting period. In response, the Registrar adopted a flexible approach to managing compliance matters. This included granting submission extensions if requested.

• The Registrar believes that, while COVID-19 poses a limited risk to viability, uncertainties remain. These make the long-term impacts of COVID-19 difficult to predict. Issues like:

  • potential rental increase freezes
  • long-term maintenance performance

  could be affected by the inability to conduct maintenance inspections. The Registrar will continue to track these issues.

• In the reporting period, Housing Australia (previously the National Housing Finance and Investment Corporation) played an increasingly important role in supplying debt finance to support the development of community housing.
• The Registrar acknowledges the importance Housing Australia and investors play in the viability and growth of the community housing sector. We will continue to work with CHPs to develop processes to:
  • reduce regulatory and reporting burden
  • maintain appropriate oversight.
• An important development in the reporting period was the continuing impact of the Social Housing Management Transfer (SHMT) Program on the community housing sector. The Registrar has engaged with SHMT CHPs over the past 18 months to understand:
  • the effect of the program on their business
  • compliance with community housing legislation.
• As expected, there was a decline in SHMT CHPs' performance in the reporting period. However, early indications are that this could be short term in nature.
• Cost pressures in general continued to affect Tier 1 and 2 CHPs. While not currently a compliance concern, the Registrar will continue to monitor the situation.