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We bring families together, thats our goal, to create an environment that is safe, happy and well cared for. The NDIS Specialist Disability Accommodation (SDA) refers to accommodation for participants who require specialist housing solutions to assist with the delivery of supports that cater for their functional impairment and/or very high support needs. SDA does not refer to personal support services, but the homes in which these are delivered.

Traditionally funding for Specialist Disability Accommodation was through centrally managed capital grants programs that provide block funding to providers.

Under the NDIS, SDA funding is now spent based on participants’ choices on where they would like to live, rather than government agency decisions on the merits of provider grants applications. Through participant choices, funding can now flow to a wide range of providers of varying scales offering new and innovative solutions, rather than being limited to incumbent players who are familiar with grants processes.

SDA funding is now delivered steadily across 20 years, rather than being tied to “lumpy” grants rounds.

To incentivise social impact investors to get on board and invest in the ‘bricks and mortar’ of NDIS SDA properties, the NDIS SDA payments have been formulated as an adjusted contribution to the cost of capital required for the land and physical buildings required for SDA needs.

When the NDIS is fully rolled out, a budgeted $700m in SDA payments will be made each year to support almost 28,000 participants requiring a specialist housing solution, an average of $25,000 p.a. per participant.

Each participant also contributes 25% of their disability pension and their Centrelink funded rent assistance towards their accommodation rent, approximately $9,412 p.a.

The NDIS SDA Pricing Framework is fixed at 5-year periods and reviews are benchmarked to a legislated formula that accounts for:

• Asset life of building 60 years

• Investment horizon of 20 years

• Increases in building costs

• Long term debt rate currently 5.2% (ten-year Commonwealth Bond rate plus 2.5% debt margin)

• An assumed 60% debt rate (same as applied in the aged care sector)

• Pre-tax equity returns of 11.6% (same as applied in the aged care sector)

• Specialist property management costs

• Higher maintenance costs

• Loss on building cost when sold

• Fees on sale of property currently 7.3%

 The NDIS Pricing Framework now provides SDA funding directly to eligible participants in the form of a capitalised monthly rental payment.

The result for investors is an above average yield from a well-appointed, well located residential investment that they can be proud of. The result for the people with disability who transition in as long-term tenants, is simply profound.

For more on how to invest in NDIS SDA houses and apartments with SDA Housing Investments, please contact us here…

You can check out our top properties here.

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