More affordable housing will soon be available to some struggling Australians, with a federal agency offering community housing providers $315 million worth of loans at cheaper-than-average rates.
The National Housing Finance and Investment Corporation - an independent government authority established in July - has raised the money through its first issue of bonds.
The bond issue is the biggest yet for a social project in Australia, with the investments eagerly snapped up by both local and global investors.
In fact, investors put in bids worth more than four times what was available, totalling more than $1.3 billion.
Community housing providers, who offer affordable rental properties to Australians who need them, can now access 10-year, interest-only loans through the NHFIC at a fixed rate below three per cent.
Providers to benefit from the first $315 million include BlueCHP, CHL, Compass, Evolve, Hume and Unity.
The NHFIC believes the deal will help add up to 300 new affordable rental dwellings into the market.
A peak body for housing providers - the Community Housing Industry Association - says the interest rate is well below what is now available.
"(That) means our members can put more money into building new homes," chief executive Wendy Hayhurst said.
The bonds have been launched with ANZ and UBS, with King & Wood Mallesons acting as legal advisors.
The NHFIC was set up to provide long-term, low-cost finance to support more affordable rental housing in Australia.
The corporation is planning to issue further bonds on a regular basis, potentially within the next 12 months depending on demand for the loans already offered.
Australian Associated Press