Peppercorn Block In Brunswick The Best Of Both Worlds

Australia’s housing crisis continues to dominate the headlines. And every day the housing crisis exists, more people are driven into homelessness. It would be easy to grow despondent. But solutions do exist and there’s a surprisingly high level of community power that can make a big difference.

Four years ago, Andrew and Glenda were on a quest to start up an apartment block modelled on social housing. Very quickly, they realised managing the properties themselves would be a big task, and so the idea was put on hold.

That was until they found HomeGround Real Estate and partnered on a peppercorn lease for a small apartment block nestled in Brunswick.

Now, the block is fostering a new community with below-market rents and contributing to wider change by helping Launch Housing to increase the volume of affordable housing in Melbourne.

Andrew and Glenda have given the property to HomeGround for a period of ten years, where he and Glenda receive just $1 in rent, but none of the costs. Modelled after federal social housing policies, rent at the block does not exceed 30% of a tenant’s income.

Because HomeGround is an ethical property management agency and reinvests all profits into Launch Housing, it was a no-brainer for the couple.

“There are two big wins – one is you’ve got more affordable accommodation out there, and two is the income that is generated goes into helping people that are homeless. Because of that last bit, your investment quadruples really.” Andrew told us.

“Sure, you don’t get any capital return, but you do get capital growth. You also have no headaches of managing the property, and you have no costs.”

In Victoria, land tax is exempt and council rates are often reduced or exempt for land used for charitable purposes, which for Andrew and Glenda was another attractive incentive.

A fence of spaced wooden pails, with a metallic sign showing the address as the numeral 47.

Desire to give back to the community

The idea of providing accommodation for people in need arose from Andrew and Glenda’s growing awareness and concern for people experiencing our housing crisis.

“We started to think about accommodation. We’re more aware of how hard it is especially for older women who face a break-up or violence. They go from being secure to being left with almost nothing at time when it’s harder to earn money,” Andrew said,

Housing is just so critical. I think more and more about the destruction of people’s lives when they suddenly find themselves in need of accommodation and don’t have it. It just wrecks them. So, we thought we could do something about this – plus, we like creating things.

Andrew, Rental provider.

Thoughtful and sustainable renovations

Andrew and Glenda are heartened that the location they have chosen to provide their social and affordable housing will provide a great sense of community and amenity for their future renters.

“To be honest, I didn’t know much about Brunswick at first. We had done some work in the area before, but never really explored it,” Andrew said.

“Then one day, we came in off Sydney Road and just had a look around. There are some awesome little shops and pubs. Before Covid, we even checked out the Brunswick Ballroom a couple of times. It’s such a lively and vibrant place.”

The facade of 47 Union Street, a block of flats with a brick exterior and highlights of yellow for doors and balconies.

For the pair, the quality of the renovation was key. “I’ve always been drawn to good or better. I think, why should someone have to live in a basic place when we can create something special or something that makes it nice to live in?” Andrew explains.

Their renovation was focused on creating a comfortable and energy-efficient space for low-income individuals. The modern design features private courtyards, a communal outdoor area and garden space, modern external electric blinds, well-designed kitchens, and balanced internal layouts which maximize space and comfort.

“That’s why we pulled all the windows out and put in double glazing. It’s not just energy-efficient; they’re also quiet and they create a calm feeling. We’ve got solar on the roof, and we’ve got communal power – so it will be great to see that all in use.”

Not without its challenges…

The project wasn’t always smooth sailing, particularly in dealing with neighbours’ concerns about social housing in their community.

“When you say you’re renovating a place to create social or affordable housing… people get scared when it’s in their backyard,” Andrew said.

“They worry because of the ideas they have about people in social housing. I get that people are concerned because they don’t know what it’s going to be like. But then when you look at the condition of the place before and what we’ve developed here, it’s a massive improvement.”

Another challenge was obtaining insurance, which Andrew found was a frustrating contradiction. “So many insurance companies have philanthropic arms of their businesses that donate to a charity or social housing. But we found out that at the same time they make it almost impossible to get insured if you tick the box that says your property is social housing. We ended up getting insured, but it wasn’t easy.”

As the first tenants settle in, Andrew and Glenda’s vision for the block has become a reality. And because of HomeGround, the couple don’t have to worry about the nitty gritty of managing their property.

This philanthropic effort and community-driven project serves as an innovative example of what can be achieved when people come together to address the critical issue of housing insecurity. The block will not only provide shelter, but a true sense of home for people who need it most.

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