The ‘shot in the arm’ for Australian affordable housing
An ambitious agenda to provide accessible, affordable housing needs to push ahead, national property council says
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The Federal Government’s proposed housing fund is the ‘shot in the arm’ required to address the housing crisis, the Property Council of Australia said today.
Property Council chief executive Mike Zorba said the Albanese Government’s second attempt to pass the Housing Australia Future Fund (HAFF) Bill through the Senate next week was to be welcomed.
The Federal Government announced the HAFF in June this year, describing it as ‘an ambitious agenda’ for affordable and social rental housing. At that time, Federal Housing Minister Julie Collins signed an amendment to the National Housing Finance and Investment Corporation’s (NHFIC) investment mandate to increase its liability cap from $5.5 billion to $7.5 billion.
However, the bill failed to pass the senate on its first attempt, sparking talk of a double dissolution trigger if it fails again next week.
Mr Zorba said Senate approval would go some way to addressing the housing shortfall in Australia. Estimates based on data from the 2021 Census revealed that more than 500,000 Australians on low income were in inappropriate housing on census night, which included homelessness, overcrowding or households where more than 30 percent of income was spent on rent.
Minister Collins said the $10 billion HAFF represented ‘the single biggest investment in social and affordable housing by a Federal Government in more than a decade’. The new initiative is expected to fund 30,000 new social and affordable rental homes.
Mr Zorba said Senate approval would kickstart the housing supply recovery.
“The HAFF is the shot in the arm the nation needs to close the housing deficit,” Mr Zorbas said.
“The 30,000 new social and affordable houses that hang in the balance need to be green-lighted by all Senators as soon as possible.
“Beyond the HAFF, the fastest paths to new housing remain setting housing targets, creating incentives for more supply and fixing broken state planning systems.
“We also need governments to boost helpful asset classes like purpose-built student accommodation, retirement living communities and build-to-rent housing,” he said.
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Strong population growth, major infrastructure spending and comparatively affordable property are expected to cement Melbourne’s position as Australia’s most attractive long-term real estate market.
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Melbourne is poised to become Australia’s largest city within the next decade, with strong population growth, infrastructure investment and relative affordability driving long-term property demand.
A new research report from Knight Frank argues the Victorian capital remains one of the country’s most compelling markets for investors, businesses and residents.
The report highlights the city’s rapidly expanding population, diverse economy and major infrastructure pipeline as key factors underpinning future property growth.
Knight Frank Managing Director Victoria, Dominic Long, said Melbourne’s fundamentals continue to position the city strongly for long-term investment.
“Melbourne continues to stand out as one of Australia’s most compelling real estate markets,” he said.
“It is Australia’s strongest long-term growth city with the fastest growing population, the most diversified economy, world-class liveability and the most affordable major market for office, industrial and residential property.”
Population growth driving demand
Melbourne’s population has grown at an average rate of 1.8 per cent per year since 2000, faster than any advanced global economy, according to the research.
In the year to June 2025 alone, the city added about 123,500 residents, the largest annual increase of any Australian capital.
Population growth is expected to remain one of the key drivers of demand across residential and commercial property markets, including housing, offices and logistics space.
The report forecasts Melbourne’s population will overtake Sydney’s by the 2030s, reinforcing its position as the country’s fastest-growing major city.
Office market offering value
Melbourne’s CBD office market is also attracting renewed attention from investors.
Prime office rents remain significantly lower than in competing cities, with CBD office space about 46 per cent cheaper than Sydney and around 13 per cent cheaper than Brisbane.
That relative affordability is expected to drive long-term demand from occupiers and investors seeking value in Australia’s largest office markets.
The city’s office sector is also showing signs of recovery, with effective rents rising in 2025 and demand increasing for high-quality buildings in premium locations.
Industrial market benefiting from scale
Melbourne’s industrial sector continues to expand, supported by strong population growth, e-commerce demand and the scale of the city’s logistics network.
The city already hosts the country’s largest industrial market, with about 34 million square metres of warehousing stock and significant land available for future development.
Industrial rents remain competitive compared with other capitals, while Melbourne’s port handles the largest container volumes in Australia, further supporting demand for logistics space.
Infrastructure pipeline supporting growth
More than $200 billion in transport infrastructure investment between 2014 and 2036 is also expected to reshape the city and support future property values.
Major projects include the Metro Tunnel, the West Gate Tunnel, the North-East Link and the Suburban Rail Loop, which together will improve connectivity across Melbourne and its growth corridors.
Knight Frank’s Head of Research & Consulting, Victoria, Dr Tony McGough, said these investments would play a key role in supporting the city’s economic expansion.
“Melbourne is Australia’s most economically diverse city and has delivered stable growth for more than two decades,” he said.
“With strong population growth, a highly educated workforce and unprecedented infrastructure investment, Melbourne is well placed to remain one of Australia’s most attractive long-term property markets.”
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