Government’s $10bn Housing Australia Future Fund passes parliament

Government’s $10bn Housing Australia Future Fund passes parliament
  • PublishedSeptember 14, 2023

Under the plan, 30,000 new buildings will be built over five years, but there is no timeline for when construction will begin.

Earlier this week Housing Minister Julie Collins said the government intended to have the fund operational as soon as possible.

“We anticipate that it will take weeks, hopefully, less than a couple of months, to get the fund up and running,” she said on Monday.

“And then, of course, we need to wait for the returns, which is why we’re putting some money up-front in terms of getting more social and affordable homes on the ground through what will become Housing Australia, that’s currently the National Housing Finance Investment Corporation.”

The nation’s peak housing and homelessness bodies have welcomed the passing of the legislation.

Community Housing Industry Association CEO Wendy Hayhurst said it’s a good start to addressing the housing crisis.

“If we look back over the last 10 years, there have not been any federal government programs of note,” she said.

“Whilst this isn’t everything we need, it’s 30,000 more than we have had really in the last 10 years coming out of the federal government.

“So that is the big win for us.”

Changes to original plan

Ahead of the final vote, the government made some changes to the HAFF to ensure it had the support of the crossbench.

It includes a guarantee that at least $500 million will be spent per year from the fund.

While a minimum of 1,200 homes will be built in each state and territory across the five year period, to ensure the funding is shared across the country.

Separate from the HAFF, the government announced $2 billion in June will be spent through what it called the Social Housing Accelerator.

The government hasn’t said how many homes the $2 billion will build, but it has suggested it will be in the thousands.

The funding has already been provided to the states and territories, which must be committed to projects by June 2025.

Earlier this week the government announced another $1 billion to build more homes, but it has not provided timelines on when this money must be spent by, and how many homes it will build.

Ms Hayhurst said the sector is “grateful” for the additional cash.

“We have a big shortfall so any funds that can go into social and affordable housing are going to do good,” she said.

When will the homes be built?

The government hasn’t put exact dates or times on the builds because they don’t have total control over construction.

Local and state governments will be key to ensuring construction goes ahead because they are responsible for laws that are crucial to unlocking land.

Ms Hayhurst said she was hopeful that some builds will begin next year.

“There are projects that have got development approvals already, or very close to it, so we are hoping because this work has been done… and the investment mandate is being drafted, it will be a matter of weeks before we are hearing from The National Housing Finance and Investment Corporation about how the tenders will work,” she said.

“We would be hoping that people would start to see activity on the ground in 2024.”

Construction sector warns problems ahead

The construction sector said an increase in demand for social and affordable home builds could be managed in the short term.

Master Builders Australia CEO Denita Wawn said people and materials are available.

“The building and construction does have the capacity to build now,” she said.

“We have a downturn in the private investment market which means we can meet government-funded projects.”

However, she warned there needed to be a long-term plan to ensure capacity was possible in the future.

“From 2025 onwards, we are predicting a significant uptick in the number of homes to be built where we will not have the corresponding workforce,” she said.

“The critical importance is working with government to ensure we train more people, encourage more people into the industry and have a flexible skilled migration scheme.”

The Australian Council of Social Service CEO Cassandra Goldie welcomed the passing of the legislation but said there was more work to do.

“We’ve got to attack this on all fronts because it is a crisis, we are very worried what we are seeing across the country with the number of people forced into homelessness,” she said.

“The renting regulations are really crucial in terms of rent caps and also protection from evictions into homelessness and those tax settings. 

“Tax concessions like the capital gains discount have been very damaging to housing affordability… we have to change the tax settings so we are encouraging big institutional investors to get into housing services.”

SOURCE: ABCNEWS

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