Coalition’s $5 Billion plan aims to deliver 500,000 new homes

Scott Kuru October 22, 2024 4 min read

Image from Getty/Tracey Nearmy

KEY POINTS

The Federal Coalition says it will set up a $5 Billion fund to help fast-track greenfield housing developments if it wins next year’s national election
The fund will provide grants and concessional loans to speed up infrastructure for new housing developments
Opposition leader Peter Dutton says the four-year plan would deliver 500,000 new homes

Housing will be a key policy battleground at the upcoming Federal election after the Coalition unveiled an ambitious plan aimed at speeding up critical housing infrastructure in greenfield developments, primarily on the outskirts of major cities.

The centrepiece of the policy is a $5 Billion fund, which would hand out grants and concessional loans over four years to local governments, utility companies and property developers to get infrastructure “shovel-ready” for building.

The Opposition leader, Peter Dutton, says the plan should enable the construction of 500,000 new homes.

However, the Albanese government says the Coalition’s policy is a “card trick”, with the Opposition actually planning to cut back existing Federal government housing programs and spend less on housing.

The details

The Coalition has promised that if it’s elected at next year’s election, it would increase the housing supply by cutting migration, by temporarily stopping foreign investors from purchasing existing homes in Australia and by allowing people to take up to $50,000 out of their superannuation to fund a deposit on a home.

Now comes the Housing Infrastructure Program.

“The cheapest form of housing for first-home buyers is detached housing with backyards, and our Housing Infrastructure Program will be a catalyst for exactly this – new greenfield housing developments,” Opposition leader Peter Dutton says.

“We know there are hundreds of greenfield sites across the country ready for development, but progress has been stalled due to a lack of funding for essential enabling infrastructure.”

If elected, the current Shadow Minister for Infrastructure, Bridget McKenzie, would be in charge of the fund, which she says would deal with speeding up the delivery of what she describes as “the not sexy stuff”, like sewerage, communications cabling, water and electricity infrastructure and access roads.

"It means putting real money on the table so local councils, property developers and others can unlock the potential of these sites and get people into their homes sooner," Ms McKenzie says.

Loans and grants would be offered on a “use it or lose it basis”.

“If there is no progress on successful projects within 12 months of contracting, then the funding will be terminated”, Peter Dutton says.

While Labor has promised to provide about $1 Billion to states and territory governments to help speed up infrastructure delivery in greenfield areas, the Coalition has promised a different approach.

It wants to bypass state governments and work directly with state-controlled utility suppliers, local governments and private developers.

“The 500,000 homes that will be delivered under this programme will be a combination of projects that might sit on the shelf for ten years and be quite significantly delayed or projects that may never actually go ahead because they just don’t stack up,” explains the Coalition’s Housing spokesman Michael Sukkar.

“So the $5 billion of funding committed under the Housing Infrastructure Program will deliver those 500,000 homes.”

The Coalition has also pledged to impose a 10 year freeze on any further changes to the National Construction Code, a move that it says will cut red tape, provide certainty to the building industry and save further costs to the delivery of new homes.

Reaction

The Coalition’s plan has been warmly welcomed by major building industry groups, including Master Builders Australia, the Property Council, the Housing Industry Association and the Urban Development Institute of Australia.

The heads of all four groups were at the official launch of the Coalition’s plan in Perth’s outer suburbs on Saturday, the 19th of October.

“We know that the key to ending the housing crisis is unlocking new housing supply, but there are a lot of barriers standing in the way of rolling projects out,” Master Builders CEO Denita Wawn says.

“Labour shortages, access to water, sewerage, power and roads, union disruption, and red tape all significantly impact the final project cost and build time.”

The Coalition’s move is “a real shot in the arm for the great Australian dream”, according to Property Council CEO Mike Zorbas.

Building groups have also welcomed the move to freeze the National Construction Code and undertake a review of recent changes that mandate energy efficiency standards.

“It's crippling, and it's adding cost,” Jocelyn Martin, the Managing Director of the Housing Industry Association says.

“We reckon it probably adds at least $30,000 to the cost of a new home.”

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Image from ABC News/Matt Roberts

Political fire

The Albanese government has described the Coalition’s plan as “absolutely fanciful.”

“We've got a $32 billion Homes for Australia plan,” Prime Minister Anthony Albanese says.

“They're going to spend less money, not more.”

“Peter Dutton's taking with one hand and giving with the other,” says Federal Housing Minister Clare O’Neil.

“It's a card trick.”

While the Coalition is committing more to greenfields infrastructure than Labor, its plan for 500,000 new homes is significantly less than the Albanese government’s stated target of building 1.2 million homes by mid-2029.