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Since Specialist Disability Accommodation (SDA) was first introduced to the NDIS back in 2016 it has been a highly complex market to navigate. Supply and demand dynamics, funding eligibility for people, interfaces with legacy / existing state and territory housing and attracting and maintaining finance have been some of the recurring complexities. There are many more, but we won’t get diverted down that rabbit hole for now.
More recently there have been a number of important reports released that impact the SDA market.
Firstly, in June 2023 the NDIS SDA Pricing Review 2022-23 Final Report was released and as previously reported, it included mostly increases in SDA annual base prices across most SDA categories. Some increases, especially in the Improved Liveability category, were well in excess of 100% uplift and most others received significant uplift, well in excess of many people’s expectations. However, at the same time there were some price reductions in 2 and 3 bedroom apartments in the High Physical Support Design Category. Whilst the sector met the outcomes with resounding support there were numerous people in the finance sector starting to wonder “well if they reduced some prices this time around, what is stopping them doing this to more categories next time?” A very sensible question especially considering the increased governance and compliance The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry imposed upon the finance markets (for very good reason mind you).
While the finance markets were trying to placate their governance structures, investment boards and others involved, about investing in SDA, the NDIS Review released their final report “Working together to deliver the NDIS” in early December 2023. Amongst the 26 recommendations and 139 actions, action 9.4 stated the following:
Action 9.4: The National Disability Insurance Agency should remove the Improved Liveability category for new Specialist Disability Accommodation (SDA) developments, and review the remaining SDA categories and associated Design Standards to evaluate their effectiveness.
It is safe to say from my observations and nearly 9 years buried in the SDA markets, that this recommended action blindsided everyone. Especially those very same finance providers, the ones that didn’t pack up in June, who having convinced their governance systems that SDA was a very sound investment, were now left with a far more difficult task to again convince people that SDA is a sound and maturing investment. Within 6 months some SDA prices had been reduced and now the future of an entire design category is also in doubt.
Obviously, for now, this is just a recommended action, and as yet we have not received any insight into the government’s attitude towards the report recommendations. However anecdotally we have heard of many proposed new SDA dwellings (in Improved Liveability) being instantly halted. This is a really big concern not only for the ability for those entering the SDA markets to access finance in future, but also for the cohort of people that typically receive Improved Liveability funding.
This cohort typically consists of people with intellectual and / or psychosocial disability with significant support needs. The cohort of people that often find it the most difficult to access appropriate and sustainable housing across any of the housing markets. Without the Improved Liveability category there is no SDA category that would be appropriate for this cohort.
As a side note – there was always planned to be a review of the SDA Design categories during 2024. It would be logical for the consideration of the future of Improved Liveability to be included in the terms of reference for this review.
In the space of just 6 months the SDA market landscape has shifted significantly. Uncertainty and doubt over whether the SDA can ever reach a period of relative stability that would enable proper planning and delivery has again grown to levels where I am seeing numerous people exit the SDA market.
Back in 2020/21 the NDIS recognised the complex nature of SDA and to assist them to make informed decisions and ensure their messaging was well considered, the NDIS created the SDA Reference Group. This group met a few times (as far as the record suggests) and then disappeared. It could potentially be a very timely consideration to re-establish this group, or a similar body, to inform future SDA related recommendations and messaging, and as a highly experienced group to inform sector consultation and codesign, assuming the review recommendations are endorsed.
