ResidentialLindsay SaundersThu 22 Oct 26
Governments Strike $3b Deal to Unlock 66,000 Victorian Homes
The Federal and Victorian governments have struck a funding agreement worth nearly $3 billion to unlock more than 66,000 homes, including 25,000 for first-home buyers, through infrastructure investment across the state.
The Commonwealth will provide $2.5 billion, comprising $2 billion in concessional loans and $499 million in grants, while Victoria will contribute at least $499 million.
The funding is designed to address infrastructure constraints that can prevent residential projects from proceeding, including the lack of roads, water, sewerage and electricity connections.
The agreement covers about 41,000 additional homes alongside more than 25,000 homes earmarked for first-home buyers, according to the governments’ announcement.
Funding allocations include $698 million for enabling infrastructure across greater Melbourne, expected to unlock more than 47,000 homes, including 11,923 for first-home buyers.
A further $91 million will support infrastructure for 5800 homes in regional Victoria, including 1900 for first-home buyers, while $82 million will support 474 homes for first-home buyers through infrastructure investment and construction in inner Melbourne.
Another $55 million will support 2040 homes through enabling infrastructure and direct construction under a Peri Urban and Regional Infrastructure Fund and the Rent to Buy Pilot Program for First Peoples.
The governments said further projects would be announced in the coming months, with first-home buyers expected to begin moving into homes from 2027-28.
The Housing Industry Association welcomed the agreement, saying infrastructure constraints and planning delays were holding back housing projects despite builders being ready to deliver more homes.
HIA chief executive industry and policy Simon Croft said the funding recognised that boosting supply was critical to improving affordability, particularly through investment in “last mile” infrastructure such as roads, sewerage, water pipes and electricity connections.
The agreement is part of the Commonwealth’s commitment to support up to 100,000 homes for first-home buyers nationally and builds on housing infrastructure agreements with other states and territories.
The funding targets a key constraint on housing delivery: the essential infrastructure needed to make land development-ready before homes can be built. The number of homes unlocked will depend on projects progressing through the development and construction process.
