Social housing, affordable housing, and public housing. They all seem similar but there are important differences as some housing tenants in Melbourne are unfortunately finding out.

A year after moving into a new public-private affordable housing complex in Melbourne, a couple has been slugged with a 17% rent increase.

The Flemington development saw the Victorian government hand over a 40-year lease to a consortium that included a non-profit social housing provider and a property developer. The lease was for public housing towers that were planned for demolition and redevelopment.

The consortium then rebuilds the site with a mix of social, affordable, and market rate rentals.

But as the tenants have discovered the affordable housing is still linked to inner Melbourne rental prices. The rents were set at a maximum of 75% of the market rent. But since market rents in inner Melbourne increased by 17%, so did their rent.

This is the important difference between social and affordable housing and the much better public housing. Public housing is fully owned by the government and exists to help people with a roof over their heads. There is no commercial imperative.

Rather than trying to insert the private sector, the government could have simply redeveloped the sites and built more public housing. It’s both simpler and better for the tenants.

For more on this story, see the article on the ABC.