Vulture landlords and the justice-washing of housing struggle

Change was afoot in St Kilda in the 1970s, as it so often was. After nearly three decades of post-war population growth accompanied by rapid apartment development and subdivision of gold-rush era mansions, upwardly-mobile migrants from the ‘50s and ‘60s began to depart for the newly-built suburbs. In their place, a stream of artists, punks and misfits flooded the area seeking cheap rent in the vacated buildings. In this stream was a combative and creative style of political expression.

The insurgence was met by opposition from middle- and upper-class residents. The elite had long tried to keep St Kilda rich and Anglo, decrying the flow of the ‘lowly classes and larrikins from the north of the Yarra’ from the 1880s. A full century later, the then-Mayor of St Kilda launched a Clean Up St Kilda campaign to rid the streets of the ‘prostitutes, pimps and poofters’.

As part of the ‘clean up’, the conservative council orchestrated a police blitz to round up the homeless and other ‘undesirables’. This was met with the formation of the St Kilda Resident Action Group (SKRAG), with a remit to protect the low-income and quirkier elements of the nascent St Kilda scene. It held its own actions, disrupting public meetings, staging marches and an ultimately organising an alternative music event to rival the St Kilda Festival. SKRAG was here to stay, and staying put meant fighting for housing justice while celebrating the parochial awesomeness of the St Kilda rock and punk scene with the motto of ‘cause trouble and have-a-lot-of-fun along the way.’

St Kilda was the most densely populated post-war municipality in Australia, and boasted some fine old buildings. The Victorian Housing Commission in the 1940s and ‘50s was reluctant to embark on the displacement and demolition program seen north of the river. As a result, by 1970 the area had low levels of public housing (1.4%) compared to the rest of inner Melbourne (10.4%). Sustained disinvestment in the private housing stock laid the ground for protracted battles over the city’s gentrification in the ‘80s and ‘90s. The question of whose image the city should be remade in—that of the precarious renters or the propertied gentry—received a qualified answer when land price increases overtook the rest of inner Melbourne, and Australia’s first local council-initiated community housing program was established.

Community activism was channelled in the 1980s through the Turn The Tide movement to transform St Kilda council, with social equity and housing justice as its defining features. This new council acquired low-cost housing and created the St Kilda Housing Association (StKHA) to manage 31 units at arms-length, drawing on the organically-acquired expertise of original members of SKRAG. The association provided community housing to low-income St Kilda locals with priority given to those who had lived longest in the area and were in greatest need. State-forced council amalgamations in 1994 merged three councils into one, creating a new municipality called City of Port Phillip. In 2001, after three decades of community-based housing advocacy and fifteen years of providing housing to St Kilda residents, the StKHA’s catchment was expanded to the whole of Port Phillip and renamed accordingly.

The StKHA model, which transferred seamlessly to the Port Phillip Housing Association (PPHA), was based on joint venture projects with council, state and federal finance. In the first thirty years, 311 units of community housing were built. The increasingly gentrified politics in Port Phillip, and a change in state policy to start funding community housing associations directly, prompted the council to set up a trust in 2005, named the Port Phillip Housing Trust, to ensure the housing stock would be kept in perpetuity. PPHA became the trustee and took over the council’s role in building new community housing across the whole of Port Phillip. Importantly, the council committed to putting $400,000 into the trust each year for ten years until 2015. In 2015 the council voted to increase the amount to $500,000 per year subject to annual review.

In its 2016 publication, Housing First: a path to social justice, the story of St Kilda Community activism and the Port Phillip Housing Association, PPHA paid homage to its activist roots, dedicating its work

[t]o the many people missing out on decent, affordable housing… and to the advocates fighting for housing justice’. Housing activists are the ‘people who understood the true essence of community and place, long before they became contemporary catchphrases.

In 2018, to shed its local focus and brand itself as the substantial Community Housing Organisation (CHO) it had become, PPHA was renamed HousingFirst. Despite the nod to its history, HousingFirst has only a tenuous relationship to its activist foundations. Like other CHOs, it owns and manages properties that house eligible social tenants, charging up to 75 per cent of market rates. The Port Phillip Housing Trust by 2020 had 414 community housing units, maintaining their rents at 30 per cent of income into perpetuity, but HousingFirst became quite something else.

CHOs are the contemporary and preferred social housing landlord of Australian governments, mainly because of the resistance from those governments to providing adequate affordable housing, and due to the ability of CHOs to attract private investment in addition to public subsidies. The larger CHOs are in essence required to scout for external investment partners in order to grow their asset base and assert  their relevance.

A major breakthrough for HousingFirst came with the Victorian Public Housing Renewal Program in 2017. Three estates in Northcote, Preston and North Melbourne were to be demolished for the construction of private units and new social dwellings in a mix of 70 per cent private to 30 per cent social. This government-backed land experiment in partnership with MAB Corporation netted HousingFirst 305 new dwellings, displacing three existing communities in the process. Since formulating this approach to the housing crisis, HousingFirst has become a key player in experimentation in the low-income housing market, based on public-private-partnership models between private investment funds, CHOs and government.


The Australian Financial Review recently reported the partnering of HousingFirst with Conscious Investment Management (CIM) to acquire housing stock in Melbourne. The partnership is a build-to-rent scheme, popular with policy makers and private developers around the world, but still emerging in Australia. Basically, a private fund builds or purchases housing with the intention of renting rather than selling the stock, collecting rental income and delivering returns to shareholders. It is a shift in the rental landscape to corporate landlord models of housing provision. In places such as Ireland these are termed Vulture Funds.

CIM will purchase 307 new-build apartments for $150m and rent them at social rates for ten years, with HousingFirst providing the tenancy management. The Victorian Government makes up the rental shortfall through its Social Housing Growth Fund, meaning the investment fund receives full market rates for the apartments. In the June 2021 quarter, Melbourne units were returning 3.95 per cent to investors. At the end of the 10-year program, CIM has the option to end the tenancies of 500 people and convert the dwellings, acquired at 2021 prices, for private rental or resale.

It’s a good arrangement for the fund: the partnership aims ‘to prove up a model that could be expanded’, says the CIM chief investment officer. ‘This is core to what we do,’ he told The Australian Financial Review. ‘We hope to, and expect to, do more of this in Victoria and interstate.’

Private investment funds rarely have the resources to manage their housing portfolio, so CHOs provide an important vehicle not just for management but credibility. CIM touts itself as an ‘ethical investment manager’ and is backed by co-investors that produce similarly benevolent rhetoric, such as the Paul Ramsay Foundation and Future Super.

The Paul Ramsay Foundation is the largest investor in the partnership and the largest philanthropy organisation in Australia with over $3b in private capital. It is a registered charity founded by Paul Ramsay, an Australian billionaire who made his fortune in the for-profit private healthcare industry (owning the largest private hospital group in Australia), luxury real estate, media and advertising. In 2019 the foundation made a profit of over $92m.

If the name sounds familiar, it might be because the Paul Ramsay Foundation established the Ramsay Centre for Western Civilisation in 2017 via an endowment made by Paul Ramsay (the Foundation and the Centre share board members). The wealth that finances the CIM-HousingFirst partnership comes from the proceeds of Paul Ramsay’s businesses, one of which was Ramsay Youth Services, a private prison operator that owned and operated for-profit youth corrections facilities, as well as a chain of psychiatric facilities that targeted children and at-risk youth in the United States.

The company ran the only maximum-security prison for female youth in Florida, until the Paul Ramsay Group sold Ramsay Youth Services after a scandal broke in the US revealing sexual abuse, inhumane solitary confinement and unlawful restraint of teenage girls by adult male staff in the facility. As reported by Kathleen Chapman for the Palm Beach Post at the time, in the three years of operation by Ramsay Youth Services—from when it opened in April 2000 to when it was sold in 2003—at least 15 staff had been fired or disciplined for sexual misconduct with the girls they were supposed to protect.

Future Super will also invest into the fund. Established in 2014, Future Super is an Australian retail superannuation fund that promotes zero fossil fuel and ‘ethical’ investments. The Fund was set up by the former head of GetUp, Simon Sheikh, and its activist credentials extend to its pioneering paid menstrual and menopause leave policy. The superfund has over $1b in funds under management. Among Apple, Visa and other blue chip stock options, Future Super also has $9.9m into Ramsay Health Care, and $8.3m in the National Housing Finance and Investment Corp, a Commonwealth corporation that makes loans, investments and grants in the community and affordable housing market.


Activism in St Kilda in the 1970s and ‘80s produced community-centred provision of housing for low-income households, and fought against the violence against and displacement of marginalised communities. It resulted in a portfolio of truly affordable housing and a small local non-profit to manage it—a model since emulated in other council areas in Australia. Port Philip council protected the local affordable housing stock it had through the establishment of the housing trust, but was powerless to subvert a future where its own creation became the bedfellow of vulture funds. By policy design and necessity under the neoliberal economic regime, CHOs must expand or be swallowed up by a bigger entity.

As they become small empires, CHOs maximise public subsidies by attracting private capital. Private investment funds now have optimal conditions for entry into the new social housing market, with minimal capital expenditure, guaranteed market rent, a not-for-profit managing the tenancies and full control of the assets after 10 years. Governments have created a social housing market that delivers dividends to private capital, dressed up as a solution to the deepening housing crisis.

HousingFirst has become a shell company—a special investment vehicle—for multinational investment funds to enter this new market. This model is supposed to expand the supply of social housing. In reality, an investment fund collects market rents, receives government subsidies, and then gets to double down on the investment when the 10-year agreement is up. As the number of people experiencing housing stress rapidly expands, the very policy we are told will help is in fact designed to perpetuate rental insecurity and increase the flow of wealth to the big corporates.


Image: detail from the cover of Whose Image? Global restructuring and community politics in the inner city by Kate Shaw

David Kelly

David Kelly is a cultural geographer that specialises in dwelling policy and activism. His research to date includes a focus upon remote Aboriginal housing, inner-city public housing, disability in the city, environmental controversy and green-led urban regeneration.

More by David Kelly ›

Kate Shaw

Dr Kate Shaw is a critical urban geographer at the University of Melbourne.

More by Kate Shaw ›

Libby Porter

Professor Libby Porter is an urban geographer and planner at RMIT University, researching how urban development causes dispossession and displacement.

More by Libby Porter ›

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  1. Braybrook 3019 used to be affordable was full of commission houses cheap rentals now the yuppies and the rich have moved in because of our location and people like myself can no longer rent private in Braybrook and our council the city of Maribyrnong is too busy handing money over to private companies instead of worrying about us locals who is soon can’t afford to live where we’ve grown up
    State government and local governments don’t care public housing stocks have been sold off to private developers
    gentrification Of Braybrook 3019 is here so want to tell my story how so unfair

  2. The article misses the point that in our extraordinarily high-cost housing environment, social housing operates at a very substantial loss, however calculated. The rather perverse reason that community housing can operate is that ‘private’ tenants have access to Commonwealth Rent Allowance. Even then, the properties have to be somehow acquired at a substantial discount.

    As a result, community housing organisations can rarely expand their stock. Victoria has the lowest proportion of social stock in the country, and the need for more stock is very great as private rental is completely unaffordable for low-income people in high-cost central suburbs including St Kilda. I lived there and was paying more than 100% of my age pension in rent.

    The only model that has ever worked for self-sustaining affordable housing in Australia is cross subsidy with higher-income tenants, as found in pre-1980 public housing. Even this is difficult today as most private rental housing is also operating at a loss.

    This model sounds like a real coup, and congratulations to Housing First for pulling it off, though it is hard to see how it will be sustainable. It is very easy to try to demonise public-private arrangements, but in the face of government apathy towards direct provision of affordable housing, I challenge the authors to come up with something better.

    1. The only answer is BUILD MORE PUBLIC HOUSING (and subsidise it if we have to).

      Also look to a future government where PUBLIC HOUSING is provided to everyone who needs it. Housing needs to be put on the same level as Healthcare, Hospitals, Education and Aged Care as core social services available to everyone. Sadly even those areas have investment vultures also well entrenched sucking public money into their private pockets.

  3. Jack’s comment today drew my attention to the earlier post from Joe, to which I have to say, Joe, there are so many erroneous assumptions in your comment it’s hard to know where to start.

    A finishing point might be, however, that there is no such thing as “self-sustaining affordable housing in Australia” or anywhere else. The idea that public and social service – such as healthcare, education, aged care, transport or housing – should have to be self-sustaining is just the beginning of the problem.

    1. I think not Kate. After working for some years in Community Housing in Victoria and writing five research reports there, and as it was my research in 1989 that led the Commonwealth to convert from loans to grants, without which public housing would now be a dim memory – nobody is better acquainted with the relative financial position of public and community housing. I also led the review of St Kilda Housing Association back in 1992.

      If you think there is something wrong with my previous post you are going to have to be much more specific. Forty years of bleating by do-gooders has done exactly nothing to solve the problem. (well – much worse than nothing).

  4. Dear Joe, yes I’m well aware of your important work. I think it’s to safe to say that the 40 years of bleating, research, advocacy, publishing, argument and lobbying from so many of us has had profoundly little effect on the neoliberal commitment to government withdrawal from and privatisation of public infrastructure. This is not for any particular inadequacy on our parts.
    I’d really like to have an open, friendly, perhaps moderated discussion involving the various proponents of affordable housing solutions, taking in the many different positions on public and community housing. It’s hard to get everyone around the table. I wonder if it can be done.
    Maybe Overland could host?

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