Housing Affordability Fund

Prime Minister Kevin Rudd along with the Minister for Housing, Tanya Plibersek have released the guidelines for the Housing Affordability Fund and announced the first round of Expressions of Interest. The Fund aims to mitigate two significant barriers to the supply of housing including reducing holding costs resulting from long planning and approval waiting times that are incurred by developers and reducing infrastructure costs such as water, sewerage, transport and open space.    In this way the Fund will increase the supply of new housing and make housing more affordable for home buyers entering the market.  It is expected that greenfield land and infill developments will be targeted where high dwelling demand currently exists or is anticipated.

Funding available

The Fund will invest up to $512 million over five years to lower the cost of building new homes.

Year/Funding Source 2008-09 2009-10 2010-11 2011-12 2012-13
Funding available $2008-09 50 75 75 150 150

As a guide, Australian Government funding will not amount to more than approximately $10,000 per dwelling for each proposal, with savings to home buyers preferably being greater than the contribution made by the Australian Government.

Expressions of Interest

The first round of Expressions of Interest for the Housing Affordability Fund commenced 15 September 2008 and will close at 5pm on Wednesday 15 October 2008. This round will cover the 2008/09 financial year.   Applicants may choose to apply for funding over multiple financial years, with the project commencing and initial funding being paid in the 2008-09 financial year.

A second round is scheduled for March/April 2009, covering the 2009/10 financial year.  The Department of Families, Housing, Community Services and Indigenous Affairs is responsible for the implementation and ongoing management of the program.


Housing Affordability Fund proposals will generally only be accepted from :

  • Local Governments
  • State Local Government Associations
  • State and Territory Governments.

While it is the Federal Government’s preference to contract with other levels of government, it is willing to consider contracts with private companies, including developers, where the prospective outcome is clearly better and guaranteed by the company.

Private companies, including developers, are generally encouraged to participate in the Fund by entering into partnership or consortium arrangements with any state, territory or local government.

Where a partnership has been entered into, if funding is approved it will only be payable to one of the partners.

Proposals will be assessed against needs-based selection criteria with priority given to proposals that improve the supply of new moderately priced housing and demonstrate how cost savings are passed on to new home

Selection Criteria

There will be two categories of program-specific criteria that will be sought from applicants, Mandatory Criteria and Weighted Criteria.

Mandatory Criteria –must be met by all applicants. Applications will be assessed by relevant State, Territory and local governments against the following criteria:

  1. Compliance with commonwealth, state, territory and local government Requirements
  2. Future Viability
  3. Detail of leading practice for Infrastructure only proposals

Weighted criteria –will be used to assess the varying merits of different applications, with the applications ranked according to the extent they satisfy the weighted criteria. The following criteria is proposed:

  1. Value for Money
  2. High Demand for New Dwellings
  3. More Affordable Homes
  4. Accessibility and Sustainability

Electronic Development Assessment (eDA)

The Government has also committed $30 million of the Fund develop the IT infrastructure and software needed to implement electronic development assessment (eDA) systems nationally.  Improvements in eDA processes will reduce delays in planning approvals, which in turn produces savings for home buyers. There is no selection process for eDA: instead funds have been allocated to each jurisdiction based on their proportion of new dwellings.

New South Wales –about $6 million

Victoria and Queensland –around $6.5 million each

South Australia –about $1.8 million

Western Australia –over $3.8 million.

Tasmania, the ACT and the Northern Territory –will each receive $500,000.

Further information on the Housing Affordability Fund and the application guidelines can be obtained by visitingthe FAHCSIA website here.

The Prime Minister’s and Minister for Housing’s Joint Media Release is available here.