28 October was another big day in the Specialist Disability Accommodation (SDA) market with the release of 3 key guiding documents. Lets take a high level look at what these documents provide.
SDA DESIGN STANDARD
The SDA Design Standard was created over the past 6 months after extensive consultation across government, private sector, the housing industry and disability organisations. It is important to note that the Design Standard sets out minimum requirements for the four design categories:
- Improved Liveability
- Fully Accessible
- High Physical Support
To enable implementation of the SDA Design Standard, an Implementation Plan will be published in the near future. This will outline the process for becoming a registered SDA assessor and the dwelling pre-registration process that will take effect from 1 July 2021. It will also outline the transition requirements between now and 1 July 2021.
The SDA Design Standard will not come into full effect until 1 July 2021 however, if you are about to commence designing new SDA dwellings(s), the SDA Design Standard should be considered to guide the design and future enrolment of SDA enrolled dwellings. The application of the standard is not retrospective so any new SDA on the market today or under construction, which has been or will be certified under the LHA requirements will still be considered new SDA in terms of pricing and dwelling registration.
Perhaps the only disappointment with the release of the SDA Design Standard is the lack of information relating to Robust SDA. However, we believe that there is a project underway within the NDIS to specifically address robust design – stay tuned!
LIMITED COST ASSUMPTIONS REVIEW
Following the previous release of exciting SDA information back in February this year, the NDIA completed a Limited Cost Assumption Review which sought industry feedback on the SDA Prices.
The review found that construction cost assumptions for new build Fully Accessible and Robust Design categories needed to be increased if they were to be attractive for investment when compared to other SDA categories. This outcome aligns closely with market activity that we are aware of through our extensive consulting across the sector and is an especially great outcome for robust SDA, which is in critically limited supply across Australia.
The review also found that increases to location factors were necessary in some parts of Sydney and Melbourne where land costs are significantly higher than in most other locations.
UPDATES TO SDA PRICE GUIDE
The outcomes of the limited cost assumption review have translated into the SDA Price Guide as follows:
- Increases in new build price limits for Fully Accessible design of between 10.1 and 16.4 per cent, depending on the build type.
- Increase in the price limits for robust design of between 9.4 and 14.1 per cent, depending on the build type.
- Increases to some location factors, which will increase price limits for dwellings in the following areas by between 4.0 and 10.5 per cent, as follows:
- Apartments only:
- NSW – Sydney – City and Inner South
- NSW – Sydney – Eastern Suburbs
- NSW – Sydney – Inner West
- VIC – Melbourne – Inner East
- VIC – Melbourne – Outer East
- Houses and apartments:
- VIC – Melbourne – South East
- Apartments only:
It is understood that the review considered all applications received from the market regarding SDA price assumptions so it can only be assumed that submissions were not received addressing other locations around Australia where there are unique cost drivers that impact the attractiveness in investment.
The new price limits, which apply from 1 July 2019, can be found in the new SDA Price Guide.
It is pleasing to see the NDIS have addressed the application of the new prices within their release of information. This takes a lot of the guess work out of the release of new prices and it would be great to see this applied universally across all areas of the NDIS.
The new SDA prices with be automatically applied to any new participant plans created from Monday 28 October 2019. However, providers have been instructed not to implement the price changes for Participants with existing plans.
The NDIS will proactively contact providers to discuss forward payment-claiming and backdating processes. The changes apply to new builds in Fully Accessible and Robust design categories or new build SDA dwellings in one of the listed locations, only. The NDIA has compiled a list of affected providers and will be contacting each of them directly. There is no action required from providers or participants.
SDA INNOVATION PLAN
The purpose of the SDA Innovation Plan is to stimulate action around SDA dwellings and in particular to ensure that SDA provides a person with a home, not a just a place where services are delivered. At a high level, the innovation plan appears to be addressing the fundamental human rights of people who need access to purpose-designed homes to live the life that they chose. Some of the central statements within the plan are truly encouraging. For example, the following excerpt aligns closely to what SDA really should deliver.
Our home and living arrangements can exert a great influence on our quality of life. Weighing up alternatives and making decisions on where we want to live may be influenced by:
- how close we want to live to friends and family
- where our children can go to school
- whether we can find work nearby or closeness to transport options
- the type of community we want to live in, and
- whether we can access public spaces, activities and services.
A well-designed home in the right location can allow for more independent living arrangements, increased community connection and access to informal supports. Too many people with disability live in housing which they have had little control over, and in places or with people they did not choose. Some participants currently live in housing that was never intended for them, such as young people in residential aged care or large group homes. A range of actions are needed to provide greater choice, and ensure future housing supply is accessible and meets the needs and expectations.
There are three pillars to the Innovation plan. These are:
The implementation of the Innovation Plan is a three phase process with Phase 1 – Understanding the Gaps and Designing the Response to be completed by May 2020. The outcomes of this phase will guide the next two phases which are:
- Implement the response to be completed by December 2020, and
- Showcase the results to be completed by June 2021.
For the innovation plan to have a real impact for people, it is vital that NDIS planners are fully engaged in the process over the next 18 months. The missing link within the SDA market at present is the process for people to receive this life changing payment for SDA as part of their plan. All too often, there are gaping holes within the process that lead to delays, confusion, frustration and inconsistent outcomes.
Overall, the release of the new guiding material is another big step in the right direction for the SDA market and for people who will benefit tremendously by being able to live their lives in purpose built, appropriate homes.
Source: Disability Services Consulting