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Young people experiencing, or at risk of, homelessness are typically eligible for government income support payments, including Rent Assistance (RA), and a social housing tenancy – in fact, they may be eligible for a social housing tenancy on a priority basis. However, young people’s income support payments are lower than other prospective tenants on social housing waitlists and, under current social rent models, community housing providers (CHPs) receive less rent from this cohort than other prospective tenants. 

The lower rental revenue creates larger deficits in operating budgets, even when compared with other prospective tenants eligible for priority social housing allocation. This higher hurdle to cost recovery will reduce the supply of community housing tenancies dedicated to vulnerable young people. And it will make it more financially difficult for CHPs to allocate tenancies, which other priority groups are also eligible for, to vulnerable young people. 

This paper enumerates the rental revenue gap between young tenants and other potential tenants in community housing. It then explores three potential policy responses for eliminating this ‘financial penalty’, the additional shortfall in operating revenue, that young tenants mean for CHPs compared with other prospective tenants eligible for priority allocation.