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Is Demand for Specialist Disability Accommodation Dropping?

If you’re looking to take advantage of the National Disability Insurance Scheme (NDIS) SDA property investment opportunity, you may be wondering if the supply of specialist disability accommodation (SDA) is catching up to the demand for it. Building a property suitable for NDIS participants is a more expensive exercise than building an ordinary house for renters — the expense is higher, but the reward is worth the extra cost.

Because SDA property is only suitable for a minority of Australians, it’s a smart idea to make sure your SDA investment property is actually going to appeal to NDIS participants — i.e. people with disability who are looking for a home.   

We provide insight into the pipeline of SDA supply and highlight the best opportunities in the SDA housing market. 

What is the current demand for Specialist Disability Accommodation?

It would be an easy presumption to make that, based on the principles of economics, demand would typically decrease as supply increases, but the unique nature of SDA has pushed the demand/supply relationship off the far edge of the housing horizon. 

The demand for NDIS properties is exceptionally high, with nearly 4.5 million Australians currently living with disability and only a small portion who are living in accommodation that fully supports their needs. 

What does the SDA pipeline supply look like?

Understanding the pipeline of supply for SDA homes is vitally important, given that not all properties are going to suit every NDIS participant in need of suitable accommodation. More so, the National Insurance Disability Agency (NDIA) is excellent at providing data of those properties already supplied, but doesn’t cover the range of scope to include housing developments that are in progress. 

At the beginning of the year, a ‘Specialist Disability Accommodation Supply in Australia’ report was released by the Summer Foundation via its Housing Hub initiative, which indicated a significant volume of SDA homes in the pipeline by surveying 57 SDA property developers and providers. The report has been written in conjunction with published NDIA data and indicates that across 2020, there were approximately 13,300 places enrolled, with just over 1,800 of those in development. Between the SDA providers and developers surveyed, they have estimated over 5,000 dwellings will be developed between 2020 and 2025.  

Drilling down into the specifics of NDIS SDA property supply

From a state-to-state perspective, the report findings were reassuring. The primary supply of SDA homes had started to concentrate less in NSW, with over half the national SDA pipeline being built in Queensland and Victoria. You might find it surprising that the Northern Territory did not have any SDA properties in the pipeline. These have only more recently started becoming available in May 2021. 

Interestingly, over 77% of the estimated number of dwellings in Australia’s SDA pipeline were for one-resident accommodation. What this exposed was that the supply was moving away from providing larger settings and instead has been focused on supplying smaller setting accommodation solutions. 

Drilling down further, the report evidenced a shift in the type of dwelling being built due to the market change. Apartments accounted for over half of the properties in the pipeline, followed by houses and then other forms of housing (villas, townhouses etc.). 

Supply opportunities for NDIS property investors

One of the silent highlights in the Housing Hub report is the opportunity for investors to ensure that their NDIS investment property is relevant and well-positioned. For example, the Northern Territory is currently well underserved, with the commencement of SDA dwellings only beginning in May 2021. Additionally, the specific design categories are critical for NDIS property investors to remain acutely aware of. 

For example, the dominant design category already established is High Physical Support, whereas the Robust SDAs seriously lagged. Finally, the report noted that the information on the needs and preferences of potential tenants is an important focus area and noted several programs and avenues for tenants to source out specific accommodation for their needs.

How you can make the most of the SDA supply pipeline 

It will be increasingly important for developers to consider eligible tenants’ preferences and housing needs as the SDA market matures to ensure that any planned development remains suitable for the demand. Investors can tap into this data by understanding which accommodation style (e.g. house, unit, etc.), what design category, and which location is the most highly sought after and in demand. 

By identifying these gaps in the current supply of SDA investment properties, you can secure your share of the $5billion in private sector investment that building the scale of housing required for the SDA market is set to stimulate. 

No one understands your NDIS Loan needs better than NDIS Loan Experts.

Get in touch with us to learn how we can help you along your NDIS property investment journey. 

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