A $33 billion plan to build 1.2 million new homes over 10 years.
Housing is at a crisis point in Australia. We have problems with housing affordability, in particular with serious generational inequity. Millennials and Gen Z are facing a negative wealth transfer compared to the older generations. (ABC, 2025).
Action is needed on a variety of fronts. More social and affordable housing needs to be built. More crisis accommodation needs to be built. More rental accommodation is needed. More rental assistance is needed. More support to the states to support homelessness. New entrants to the market need to be supported. New homes of all types are urgently needed. (State of the Housing System. 2025)
This policy responds on different levels:
- Social housing and Affordable rental housing
- First home buyer incentives
- Crisis accommodation
- Infrastructure incentives
- Incentives for the states to build more homes
- Increase Commonwealth Rent Assistance
- Financing more social and affordable homes. (Prime Minister, 2025)
Key Challenges
Building homes requires a great deal of preparation and the overcoming of many obstacles. Firstly, there is local government land use and planning approvals. Local infrastructure may be lacking; there is clearly a shortage of skills and a shortage of materials has contributed to sharp price rises for these materials. (State of the Housing System. 2025) The productivity of home building hasn’t improved for some time, which there is a parallel policy to encourage alternative methods of construction.
There is also limited land for greenfield development and redevelopment needs to be close to employment and transport hubs. The cost of developing high density housing (apartments) has increased to make them non-feasible in many cases. There is also unused capacity in existing dwellings, especially as our population grows older. There is unlikely to be a palatable policy response to this last problem. (State of the Housing System. 2025)
There is also the problem of the hidden homeless. “The 2021 Census showed that 122,000 people were experiencing homelessness” but “The number of clients accessing specialist homelessness services rose slightly in 2023–24 to 280,000” (The State of the Housing System. 2025). Then there are those who can’t access homelessness services for various reasons.
Policy Design
This approach requires incentives for first home buyers, a better deal for renters and more social and affordable housing. Housing affordability is the ability of people to be able to afford to purchase a home. Affordable Housing is a category of housing where purchase or rental is assisted by subsidies to bring the cost of that housing within the reach of people who otherwise couldn’t afford a home. The “affordable” cost is 25-30% of household income. (AHURI, 2023)
The policy response of punctuated equilibrium in this instance relies on the past implementation of the GFC stimulus package that included a burst of public housing construction and the present which relies on a significant change following an election to manage the quantum of the desired new housing.
“… punctuated equilibrium… notes that policies might experience long periods of stability, with just incremental changes, until some major shift in circumstances. This creates the conditions for a radical reassessment … “(Althaus, et al, 2022)
There is a range of instruments to choose from: policy through advocacy, law, money, government action, behavioural techniques, network.
Advocacy started this initiative through election promises. No doubt further advocacy may be needed when problems and criticisms arise. It is law through budget allocations. Further laws should not be needed. Money will be key since the policy is proposing a hugely expensive program. Government action is important since government is leading these policies. While private sector companies will no doubt be involved it is a government led initiative in keeping with the current government’s hands-on approach. Behavioural techniques are always present.
Network will be of prime importance. “A policy network is a configuration of players built around prior relationships, information, and exchanges of information and ideas.” (Althaus, et al, 2022). Given the broad range of stakeholders these networks will be essential.
Stakeholder Engagement:
Engagement is continuous. It is important that stakeholders feel in touch with the design and implementation to keep them on board. This supports legitimacy and build support for the choices made. (Althaus, et al, 2022)
The stakeholder list will be extensive. It includes (but is not limited to):
- Government agencies and departments
- The Minister
- Applicable unions
- TAFE and other post-secondary institutions
- Housing associations
- Financial organisations that finance affordable housing
- Master Builders Associations (MBA), state and federal
- The Property Council of Australia
- Trade associations
- Real Estate Institutes (REI) state and federal
- Local governments
- State governments
- Relief agencies
- The community
- Communities of interest
Stakeholders will have different needs and different views. They all should view the policy proposals and be given the opportunity to supply new ideas and suggestions. An overly prescriptive approach may generate resistance. Master Builders and RE associations may prefer less government involvement and prefer more private sector involvement while Housing Associations and relief agencies may prefer more government control, not to mention money.
Any obstacles thrown up by the engagement should be overcome with negotiation and consideration of alternatives. If debate is structured well then engagement should be positive.
An examination of the needs and aspirations of each stakeholder will reduce the chance for misunderstandings and misdirection. It is important to not only meet the needs of stakeholders, but to have them conscious of that fact.
A good engagement design is essential to include all voices who wish to be included. Deliberative engagement is the most thorough- where at least some of the decision-making power is handed off to those engaged. The first choice should be digital engagement to provide opportunities to people connected via the internet. It could be to select groups or the public generally in stages. This is immediate and broadly available.
The use of options papers and invitations to submit ideas will be considered. If the problem definition needs refinement, then engagement will reveal that need. The investment will be time and money but the finished policy should have broad support with trust and transparency. (Althaus, et al, 2022)
The debate will be public so unwanted voices will participate and stalemate is possible. This risk needs to be managed. (Althaus, et al, 2022) The biggest challenge is likely to be the competing interests of stakeholders. These need to be carefully managed to avoid disappointed and consequently disaffected parties.
Given that this project will be dealing with marginalised communities care and sensitivity must be taken with their engagement to provide safe spaces within which to “explore and establish identity and ideas with like-minded people.” (Althaus, et al, 2022)
It is likely that we will need to establish several “policy communities” to continuously engage with the policy implementation, allow their influence and ensure the ongoing support of these communities. These policy communities will need to be suitably diverse. Once feedback is received it needs to be collated into similar, opposing and divergent views for presentation. The feedback cycle should also be continuous.
Ultimately any decisions rest with the Minister. We can but recommend.
Evidence
Access to housing is a basic human right. (National Shelter, 2025) (Universal Declaration of Human Rights, 1948). Improving this access for the whole population is a complex task and requires a systematic approach.
There are approximately 640,000 Australian households whose housing needs are not being met. (Ryan van den Nouwelant, Laurence Troy, Balamurugan Soundararaj, 2024).
In a study by 6 councils in Melbourne’s east they calculate that there will be a shortfall of social housing in their area of 10,450 by 2026 and 11,580 by 2036. (Knox City Council, 2015 P6). There are than 537 councils in Australia with 45% in urban and urban fringe areas. While extrapolation isn’t evidence the notion of an average of 2,000 extra social homes needed across about 250 local government areas is a huge shortfall in social housing alone.
A key driver is intergenerational inequality as detailed above. The sharply increasing proportion of people who are renting rather than buying is a pointer to the unaffordability of housing. Another contributor is the “Australian dream” of a detached house with a backyard, still popularised in media as a place for “backyard footy” and “backyard cricket”. Continually rising prices, well above inflation, further locks people out of the market as demand exceeds supply.
The pressures on housing are illustrated by: “the national rental vacancy rate is at a record low of 0.9 per cent, with advertised rents 10.2 per cent higher in capital cities and
9.7 per cent higher in regional areas over the 12 months to September 2022.” (National Housing Accord, 2022) These pressures make finding any form of housing for those who can’t afford the rent or who are already homeless extremely difficult.
As stated above there are more than 280,000 people homeless in Australia in 2025.
Implementation challenges
Some of the implementation challenges are incomplete specification, inappropriate agency,
Conflicting objectives, incentive failures, conflicting directives, limited capacity, inadequate administrative resources, communication failures, policy settings and instrument choice. (Althaus, et al, 2022)
Implementation often occurs under pressure. To be ready for problems requires a plan:
Manage effectively (Althaus, et al, 2022)
Identify challenges and risks to implementation
Engage with stakeholders
Establish governance arrangements
Ensure the right skills and systems are available
Document approved assessment processes
Maintain focus on objectives
Keep good records
Actively oversee the budget
Preparation is key. As is a standard in all project management thorough preparation is an antidote to failure. Regular reviews are essential. Keep effective track of the program. Many problems should be avoided by a thorough engagement of all the parties. A federal system provides added pitfalls but keeping all stakeholders involved and informed should alleviate potential problems.
Should it happen that problems occur then returning to the stakeholders with the problem will elicit potential solutions and undoubtedly some criticism. A blame free environment is more productive but given the high political content it is highly unlikely.
Bureaucratic organisations are renowned for not being flexible so strategies to deal with such inflexibility would be useful. Bureaucracy is also evident when unions feel they have not been adequately considered. Given the involvement of the building industry union involvement is inevitable. Some conflict with contractors is another likely problem.
Interest groups may attempt to divert the project for their own ends but a strict observance of a focus on the objectives should keep the project on track. If the engagement plan is thorough then any affected (and existing) interest group would already be involved.
A media plan will be needed to deal with any surprises and respond to day-to-day queries. A coordinated response to any problem will be more effective.
Evaluation and challenges
Evaluation should be iterative and begin at the earliest possible opportunity during the project. Regular feedback is very valuable to the progress of the project.
Clear criteria for evaluation need to be established at the beginning. Every implementation process is also a learning process. Key Performance Indicators (KPIs) must be set with measurable outcomes. The use of motherhood statements in KPIs is not helpful. There must be clearly articulated outcomes.
It is recommended to “ensure the policy or program is built upon a series of SMART objectives. SMART is an acronym for specific, measurable, achievable, relevant and timed.” (Althaus et al, 2022) This is not perfect but is important to know what success is.
Criteria must be developed to measure success. Recommended criteria are:
- Relevance- does it meet the needs of stakeholders? Particularly those in need of housing.
- Coherence- How well do the interrelated policies interact? Are we building enough social and affordable homes?
- Efficiency- is it a good use of public money? Hard to argue with building homes.
- Effectiveness- are the results worthwhile? Are we meeting, or approaching, targets?
- Impact- has it made a difference to people’s lives? Are there many more people in homes than before?
- Sustainability- can the policy be maintained over time. (In the case of housing, yes.)
(Althaus et al, 2022)
We must ask if the project made a measurable difference to people’s lives.
The evaluation process will follow the policy process:
- Understand the program and its assumptions
- Develop evaluation objectives
- Design an evaluation plan
- Collect and assess information
- Report outcomes
- Integrate findings
(Althaus et al, 2022)
There are risks in evaluation. The Ratchet effect occurs when incremental target adjustments allow managers to achieve below the original objective. The threshold effect occurs when uniform targets give an incentive to aim just for the target and not beyond which stifles innovation. Output distortion which allows managers to manipulate report outcomes to meet the targets. (Althaus et al, 2022)
Performance regimes need to be well specified and well managed. The results of evaluation need to be concise and defendable. (Althaus et al, 2022) A good evaluation effort is a great learning opportunity.
The major evaluation is at the completion of the project when all data is available. Interim evaluations can check that the project is on-track but the crucial evaluation is at project completion. In this case it will be in numbers of homes completed, number of social homes completed, numbers of new home buyers in homes, a serious reduction in numbers of homeless people and people relying on emergency relief agencies and the stability of housing prices.
References
Althaus, C., Bridgman, P., & Davis, G. (2020). The Australian policy handbook: A practical guide to the policy-making process. Routledge.
APS. (2021). Getting stakeholder engagement right. Australian Public Service Commission [Website]. Retrieved from: https://www.apsc.gov.au/initiatives-and-programs/workforce-information/taskforce-toolkit/stakeholder-engagement/getting-stakeholder-engagement-right Links to an external site.
Arendt, H. (1958). The human condition. University of Chicago Press.
Australian Local Government Association 2025
Botterill, L., & Fenna, A. (2019). Interrogating public policy theory: A political values perspective. Edward Elgar Publishing.
Colebatch, H. K. (2006). Mapping the work of policy. In Colebatch, H. K. (ed) Beyond the policy cycle: The policy process in Australia. Allen and Unwin.
Ffrench-Constant, L. (2014). How to plan, write and communicate an effective policy brief: Three steps to success. Research to Action [Website]. Retrieved from: https://www.researchtoaction.org/2014/10/plan-write-communicate-effective-policy-brief-three-steps-success/Links to an external site.
Generation ‘screwed’: How gen Z and millennial housing concerns are shaping the election
Hay, C. (2006). Globalisation and Public Policy. In Moran, M., Rein, M., & Goodin, R. (eds) The Oxford handbook of public policy. Oxford University Press. pp. 587-604.
Intergenerational Report 2023: Australia’s Future to 2063. Commonwealth Government of Australia. Retrieved from: https://treasury.gov.au/sites/default/files/2023-08/p2023-435150.pdfLinks to an external site.
Maddison, S., & Denniss, R. (2013). An introduction to Australian public policy: Theory and practice. Cambridge University Press.
National Housing Accord 2022
Australian Government
Podger, Hall, Woods and Trewin, (2023). Making the Intergenerational Report More Relevant and Useful. In: Podger, Hall and Woods, (eds) More than fiscal: The Intergenerational Report, sustainability and public policy in Australia. ANU Press, pp. 1-13. https://press-files.anu.edu.au/downloads/press/n10874/pdf/ch01.pdfLinks to an external site.
Policy Toolkit
https://www.digital.gov.au/policy-toolkit/policies-and-instruments
Prime Minister’s media release
https://www.pm.gov.au/media/multi-billion-dollar-investment-build-more-homes-australians
Project Plan
https://www.digital.gov.au/policy-toolkit/resources/Project%20Plan
Ryan van den Nouwelant, Laurence Troy, Balamurugan Soundararaj (2022)
Community Housing Industry Association
Quantifying Australia’s unmet housing need; A national snapshot.
Public administration Institute
https://pubadmin.institute/public-policy-and-analysis/challenges-implementing-public-policies
Simons, M. (2020). Cry me a river: The tragedy of the Murray-Darling Basin. Quarterly Essay, Issue 77.
State of the Housing System 2025
National Housing Supply and Affordability Council
Australian Government
laborlight 