Alannah MacTiernan

9 February 2012 – Investment group Questus Limited will make use of its $20 million funding under the National Rental Affordability Scheme to push housing sustainability standards in remote areas of Western Australia, Questus director and former WA planning minister, Alannah MacTiernan told The Fifth Estate this week.

Questus was allocated 920 NRAS subsidy packages for towns across the Pilbara and for Broome and Derby in October last year. These will be delivered by June 2014 and the company is working with modular housing manufacturers and local builders to ensure the housing is as sustainable as possible.

“We will be using high quality transportable housing for the first tranche of four houses. The manufacturers of this housing are really achieving incredible standards, with Australian Modular Solutions who will be doing the first tranche, saying they can achieve 10 star without the need for airconditoning,” Ms MacTiernan said.

Questus will provide airconditoning in its housing but aims to reduce its use over time. The key, Ms MacTiernan said, is the use of highly efficient insulation or thermal blanket, similar to that used in cold storage buildings, between the internal walls and the external corrugated iron cladding. This keeps out the intense heat of the Pilbara region.

The company is working with local builders to ensure they adhere to minimum six star standard, with an aim to achieve much higher.

Ms MacTiernan said the allocation was the first time the scheme had been extended to the Pilbara, an area where affordable housing has been severely lacking. She sees it as a great opportunity to push for higher standards.

“We are trying to keep the houses as affordable as possible but across the board we’re aiming to raise the sustainability standards. We have asked builders to aim for 7.5 or eight stars.

“We’re using national Building Code of Australia standards as the Western Australian government has not shown much commitment to addressing climate change and hasn’t yet introduced a state standard.”

The jointly funded federal and state government NRAS provides investors with a $10,000 a year  subsidy indexed for 10 years to provide rental accommodation for low to medium income earners at below market rents.

The Pilbara and other mining areas face a shortage of housing

Questus is hoping to attract small business owners, who would then lease the housing under a salary packaging arrangement. Both employer and employees can benefit from a salary package, which offers award level wages but highly subsidised rents, as accommodation is fringe benefit exempt in the Pilbara

“We have developed a model to make this scheme work in the high rent environment of the Pilbara where mining has pushed up the price and availability of land. Essentially we will be constructing dual occupancy houses, which will allow two separate tenancies and two NRAS entitlements,” Ms MacTiernan said.

“This will deliver investors a tax free subsidy of nearly $250,000 over 10years, while rents will be a minimum of 40 per cent below market price.”

The first tranche of four houses will have three bedrooms with separate studio apartments. Questus is applying for planning approval for a “whole batch of granny flats” in Karratha to overcome the shortage of land in the northwest and to increase the supply of housing quickly.

“We got the council to change the rules for dual keyed housing so that you don’t have to be a relative to live in a granny flat. This means existing owners of land can use the opportunity to get more rent. It is a good way of providing affordable housing.

Ms MacTiernan said Questus has been meeting with small business groups, not for profit employers and traditional owner land holders as well as builders over the past  year who had been very eager to have the scheme extended to WA’s North.

She believes that as the push for both affordable and sustainable housing increases, there will be a lot more prefabricated modular housing built across Western Australia.

Prefabricated housing on a massive scale
“There are around six companies producing high quality transportable housing on a massive scale in Western Australia and I think the use of this type of housing will filter across to Perth. There is a move to prefabricated housing because of its obvious advantages of being transportable and cost effective Ms MacTiernan said.

Some of the companies producing prefabricated housing in WA include AMS, McGrath Homes, TR Homes and BGC Modular.

Questus has received planning approval for the first four houses, which will be constructed in Port Hedland. It is currently applying for building licences and expects the houses to be completed before the end of the financial year.

The company also received a further 314 NRAS allocations in Perth and the South West of WA, taking their total allocations across Australia to 3405.

It works closely with developers and not for profit housing and tenancy managers in each state, including Foundation Housing in WA and Horizon Housing / Gold Coast Housing Company in Queensland to develop and manage properties under the scheme.