Housing affordability is a growing issue around the country, but the Australian Government’s National Rental Affordability Scheme aims to make it a little easier for people to find and rent an affordable property.
We took a tour of what the NRAS has to offer renters and investors.
What is the NRAS?
The National Rental Affordability Scheme (NRAS) began in 2008 and is an attempt by the Government to address the shortage of affordable rental housing by offering financial incentives for investors to build and rent dwellings to low and moderate income households at below-market rates.
It aims to address the problem many have in finding affordable rental properties by increasing the supply of new affordable rental housing, while reducing rental costs for low to moderate income households. Alongside this, the scheme encourages large-scale investment and “innovative management” of affordable housing.
The NRAS does not provide social housing; rather, it’s focused on making more affordable rental homes available to families and individuals.
Why do Australian renters need the NRAS?
Housing affordability is a big issue for buyers and renters. More people are now renting for longer, but rents are higher than they’ve ever been, especially in the wake of the COVID-19 pandemic with rent rises recorded across every Australian capital except Melbourne compared with the 18-months prior according to Propertyology’s latest report.
After annualising the current weekly rents and comparing them to what they were 18 months ago, the report found an increase of $1500 or more was recorded in 34 towns and cities.
Six of the nation’s eight capitals recorded an annual rise of $1500 or more, which further underscores the need for governments to provide affordable housing, especially for those on fixed incomes.
What are the NRAS eligibility requirements?
The NRAS is aimed at low to moderate income earners, so only applicants who fall within specified income limits will be able to rent through the scheme. Eligible individuals and families are able to rent NRAS dwellings at 20% below market value rent.
To be eligible applicants:
- are Australian citizens
- need to supply evidence of their gross income for the previous 12 months (as well as the whole time they intend to reside in the home)
- as a household must not earn over 25% of the income limit over two consecutive years
The total income of all tenants of an NRAS rental property is used to calculate the overall household income for that property.
Read more about the NRAS for tenants here.
On the other side of the fence, the NRAS provides an annual incentive to investors (either persons or other entities, such as financial institutions, medium to large-scale investors, private developers, not-for-profit organisations and community housing providers) to buy and then rent dwellings to low and moderate income households. The incentive is available to approved participants in the form of either a monetary payment or a refundable tax offset the following financial year.
Read more about the NRAS for organisations here.
From 2014-15 it was announced in the federal budget that there will be no new properties built within the scheme, meaning the only dwellings eligible for NRAS incentives are those that are currently being built or have already been completed by approved participants.
What kind of rental listings are available?
All types of homes are available under the NRAS including studio dwellings, townhouses and larger family homes.
Where are these NRAS properties?
It’s a national scheme so the dwellings are located around the country.
Here is the up to date list of all the NSW NRAS properties.
Here is the current list of all Queensland NRAS properties.
Here is the full list of Victorian NRAS properties.
Here is the complete list of all WA NRAS properties.
How is the rental process managed?
The NRAS is focused on being an incentive scheme, and it does not provide tenants with any special rights over and above the relevant residential tenancy legislation in the State or Territory where the dwelling is located. Tenants sign a standard lease for the property the same as for any other rental.
Prospective renters can contact one of the approved participants or their tenancy managers for available properties and NRAS properties may also be advertised for rent on real estate websites like realestate.com.au. In Queensland, tenants must register with the Queensland Government’s One Social Housing Register.
NRAS tenancy managers can include not-for-profit organisations (such as a community housing provider), commercial businesses (such as a private real estate agent), local government bodies or State or Territory governments.
This article was originally published on
12 Oct 2021 at 9:00am
but has been regularly updated to keep the information current.