National Housing Accord Australia — What It Means for Home Buyers
The National Housing Accord is an agreement between the federal government, state and territory governments, local governments and industry to build 1.2 million new, well-located homes in Australia between 2024 and 2029. It represents Australia’s most significant housing supply commitment in decades.
What Is the National Housing Accord?
The National Housing Accord was agreed at the August 2023 National Cabinet meeting. The core target: 1.2 million new homes in the five years from 1 July 2024 to 30 June 2029.
Why it matters: Australia has a significant housing undersupply problem. Decades of low construction relative to population growth — compounded by post-COVID immigration surges — have pushed vacancy rates to historic lows and property prices to historic highs. The Accord is a structural response to this imbalance.
What the Accord Involves
Federal government commitments:
- $3 billion in New Home Bonus payments to states and territories that meet or exceed their housing targets
- $500 million in Housing Support Program funding for states that clear planning backlogs and support housing delivery
- Australian Housing Future Fund (AHFF): $10 billion fund to generate returns used to fund social and affordable housing construction
- Commonwealth’s Housing Australia Future Fund (HAFF): up to 30,000 new social and affordable homes in first five years
State and territory commitments:
- Each state and territory has an agreed housing target contributing to the 1.2 million total
- Planning system reform — including zoning changes to allow higher density near transport hubs
- Streamlining development approvals
Local government:
- Encouraged to reduce development approval delays
- Planning rule changes to allow infill development and increased density in established suburbs
National Housing Accord Targets by State
Targets are indicative and subject to negotiation. Actual allocations may vary.
| State/Territory | Target (5 years) |
|---|---|
| NSW | ~377,000 |
| VIC | ~231,000 |
| QLD | ~197,000 |
| WA | ~131,000 |
| SA | ~75,000 |
| ACT | ~30,000 |
| TAS | ~15,000 |
| NT | ~5,000 |
| Total | ~1,200,000 |
How the Housing Accord Interacts with Planning Reform
Australia’s housing undersupply is primarily a planning and zoning constraint issue. The Accord encourages:
Medium-density infill: Zoning reforms in most states allow 3–6 story apartments within 400–800 metres of train stations and major bus corridors — often called “Transport Oriented Development” (TOD) or “activity centre” zoning.
Greenfield development: Unlocking land on urban fringes for new housing estates.
Social and affordable housing: The HAFF and AHFF target construction of homes for low-income earners and key workers — a segment of the market that private developers typically do not serve at scale.
Is the Target Achievable?
Independent analysts and industry bodies have raised questions about the achievability of the 1.2 million target. Key constraints include:
- Construction industry capacity: Australia’s construction sector faces shortages of skilled tradespeople — concreters, carpenters, electricians and plumbers are all in short supply nationally
- Construction costs: Material and labour costs rose sharply from 2021–2024, compressing builder margins and making some projects financially unviable
- Planning approvals speed: In many LGAs, development approvals still take 12–24 months — slowing the pipeline of approvable projects
- Financing conditions: Higher interest rates (2022–2024 period) dampened developer feasibility for new apartment projects
The Housing Industry Association (HIA) and Property Council of Australia have both noted that 1.2 million completions in five years is significantly above recent historical construction rates — averaging approximately 170,000–200,000 completions per year would be required, versus recent actuals of 160,000–180,000.
What This Means for First Home Buyers
If the Accord delivers at scale:
- More supply — particularly medium-density units near transport — would increase competition for sellers and potentially reduce price pressure
- New builds create FHOG opportunities in each state
- Increased supply of social and affordable housing reduces pressure on the private rental market, which can indirectly affect prices
Realistic expectations:
- Major supply increases typically take 5–10 years to fully flow through to market prices due to planning, construction and absorption timelines
- Individual market conditions vary significantly — regional areas may see supply increases faster than inner-city apartments
- Price effects of supply policy are complex and interact with interest rates, migration levels and income growth
Other Housing Policy Measures Running Alongside the Accord
Help to Buy: Federal shared equity scheme (separate to the Accord but part of the broader housing policy package).
National Rental Affordability Scheme: Provides incentives for investors to provide dwellings at below-market rents.
State-specific planning reforms: NSW TOD policy (housing near train stations), VIC Activity Centres, QLD Priority Development Areas, WA infill targets.
Frequently Asked Questions
What is the National Housing Accord? An agreement between federal, state and local governments to build 1.2 million new homes in Australia between July 2024 and June 2029. It includes funding incentives, planning reform and social housing construction commitments.
Will the National Housing Accord lower house prices? Supply increases can put downward pressure on prices over time, but are unlikely to cause price falls by themselves. Interest rates, migration levels and income growth all interact with supply. Most economists expect the Accord to moderate price growth rather than cause price declines.
Is the 1.2 million home target realistic? Industry bodies and analysts have flagged concerns about achievability given construction workforce constraints, costs and planning system delays. Actual completions over the period may fall short of the target — though even partial achievement would represent meaningful supply improvement.
Related Guides
This article provides general information about government housing policy. Housing policy effects are complex and vary by location and market conditions. For advice tailored to your situation, speak with a licensed mortgage broker or financial adviser. Find one through MoneySmart.