Developer tells investors how to make money from Victoria’s homeless
DESPERATE people locked out of private rentals are being spruiked as an “investment opportunity” by builders because the State Government won’t provide enough social housing.
South East
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DESPERATE people locked out of private rentals are being spruiked as an “investment opportunity” by builders because the State Government won’t provide enough social housing.
Frankston based Modo Project Builders has advertised shared housing and crisis accommodation developments on its website as property opportunities that “provide up to 10 times the rent for just one simple investment”.
Modo principal Glenn Dornbusch said the company was meeting a social need because governments at all levels did not provide enough low-cost housing.
“We open the doors and these (rooming houses) fill up in a month or a month and a half,” Mr Dornbusch said.
He said the idea to build rooming houses came to him after seeing so many “slumlords” operating around Melbourne. “There are at least 50 or 60 (poor quality rooming houses) in this area.”
Many of the houses were “quite illegal, they are not registered”, he said.
“I have seen one of these houses ... they were renting out a walk-in robe for $150 per week.”
He said the private sector would only step up if it could make a return on investment and while the builder could not control how much rent landlords charged for each room, they did tell buyers about market values.
There were more than 4000 people on the public housing waitlist in the Dandenong area, which covers Casey, at the end of the 2016-17 financial year. However, the Council to Homeless Persons said the real number of people in need of housing was likely to be much higher, because some people didn’t apply for housing after being told they would be waiting many years.
CHP chief executive officer Jenny Smith said rooming houses were the last thing standing between many people and homelessness.
She said they were mostly used by people shut-out of private rentals but owners could still discriminate between tenants and there was no maximum rent they could charge. A rooming house is a building where one or more rooms are available to rent, and four or more people can occupy those rooms.
Minister for Consumer Affairs Marlene Kairouz said, “rooming houses are an important feature of the rental market — particularly for people unable to rent an entire dwelling on their own.”
The state government said it was is investing $185 million to redevelop public housing properties at sites across Melbourne with an increase of “at least” 10 per cent in social housing.