What Does the SDA Pricing Review Mean for Your NDIS Property Investment?
The National Disability Insurance Agency (NDIA) recently released the results of the Specialist Disability Accommodation (SDA) Pricing Review for 2022-23 as part of the broader NDIS Annual Price Review. The comprehensive review aimed to assess the existing SDA pricing structure’s effectiveness in attracting investment to meet the projected demand for SDA and accommodate all eligible individuals.
As an existing or prospective SDA property investor, the review results have brought potentially exciting news! Read on to find out more.
The results of the specialist disability accommodation pricing review
The value of SDA
If you’ve been drawn to the socially-focused outcomes and high rental yield of SDA properties, then you’re likely already well aware of the value they offer to individuals living with disability and yourself as an investor. However, the review highlighted the recognition of SDA’s value, specifically, that SDA is essential for the long-term sustainability of the National Disability Insurance Scheme.
The report explained that SDA has been recognised as a crucial support system that aids in reducing the lifetime support costs of NDIS participants, contributes to sustainability and helps relieve the pressure on hospitals. Furthermore, SDA was recognised as enabling younger people living with disability to move out of residential aged care facilities and access better social engagement and independent living.
One of the most pertinent financial outcomes of the SDA pricing review was its impact on SDA prices: the review resulted in significant price increases across most SDA categories. Specific examples have seen pricing double compared to previous rates, with improved liveability (IL), robust design category dwellings, and two and three-resident houses across all design categories experiencing substantial price hikes. There is also increased pricing for 4-5 bedroom group homes and provision of additional funding for more bespoke SDA projects that don’t fit within the existing design standard or pricing matrix.
The increased pricing also extended to support sustainability efforts within SDA properties, including solar panels and batteries in new specialist disability accommodation dwellings. On top of the environmental outcomes of encouraging sustainability measures in SDA, the potential for reducing the daily cost of power for the NDIS participants calling the properties home helps reduce their total power bills!
Pricing determination of SDA
As of the 1st of July 2023, the prices of SDA now consider the Goods and Services Tax (GST) position of the delivery of each dwelling. This means that if the owner claimed GST input tax credits for the construction costs or purchase price of the SDA property, it will affect the pricing.
How can investors support NDIS participants?
Providing assistance via SDA funding was one of the ways that private market investment into specialist disability accommodation has been encouraged by the Australian government. However, investing in SDA housing does more than potentially improve an investor’s financial position — SDA dwellings provide the opportunity for Australians with disability or extreme functional impairment to find a home that comes equipped with the necessary provision to meet their high physical support needs.
As NDIS investment specialists, Apollo Investment welcome the results of the SDA pricing review and are here to help you find the right property, navigate the SDA market and pricing arrangements, but most importantly, help improve the life of a fellow Australian. When you build specialist disability accommodation, you help build a future for individuals with disability.