You are using an outdated browser. Please upgrade your browser to view our website properly.

Victorian Government to create 43,000 jobs with $5.3 billion public housing spend

Market insights 1 week ago Read time: 4 minutes

The Victorian government has announced a $5.3 billion spending blitz, with the aim of offsetting the impact to the state's economy from the loss of up to 61,000 private dwellings. The money will be put towards building 12,000 public and community housing homes over the next four years, with Premier Daniel Andrews saying that the project is the largest boost to affordable and social housing in Australia's history.

"This is all about securing livelihoods, many, many jobs and giving that construction industry the certainty that they need after a very challenging year," he said.

"Each of those 10,000 workers a year for the next four years can spend, can invest with the certainty of that pipeline of work. It's all about creating economic activity and economic benefit for every single Victorian."

Victoria’s housing supply will increase by 10 percent thanks to the package, across four years. The announcement comes as the number of households on the Victorian Housing Register was in excess of 48,000 in September. This follows figures from last year, highlighting that Victoria was already suffering from a lack of social housing of around 100,000 residences, and was predicted to exceed a shortfall of 160,000 by 2036 – without meaningful intervention.

Estimated to generate $6.7 billion in economic activity, the package comes at an important time for the state – with Melbourne and Sydney most exposed to the slowdown in population growth which is a result of the international border closures. 

Australia’s peak homelessness body has called on the federal government to step up and “turbocharge” Victoria’s record $5.3bn investment in social housing.

Homelessness Australia chief executive Jenny Smith said the Andrews Government had shown leadership by committing to creating 43,000 jobs, “but co-investment by the federal government is needed to deepen the impact, provide more jobs, and make further inroads to Victoria’s shortfall of 102,800 social housing dwellings” she said.

“The federal government should use Victoria’s historic investment to start a nationwide mega housing build … to support the nation’s recovery.”

UDIA Victoria chief executive Danni Hunter said the call out for pre-existing projects offered private residential developers “a real opportunity” to repurpose housing stock they hadn’t been able to sell or settle due to COVID-19 into much-needed affordable housing.

This would help keep the pandemic-hit industry afloat for the next four years, and pick itself back up again afterwards. “New projects will be able to commence without fear of any oversupply issues,” she said.

Ms Hunter attended a meeting on Monday 16 November with Housing Minister Richard Wynne and new Homes Victoria chief executive Ben Rimmer, in which they stated they wanted to “hear from people with projects that could be commenced before the end of next year”.

Regarding the spending announcement from the Victorian government, Matthew Kandelaars from the Property Council of Australia, said the investment was critical to Victoria's economic recovery from the pandemic. The property industry was the biggest contributor to the state's economy, he said.

"Victoria is suffering from an extended lockdown, over and above what the rest of the country has seen, so this sort of activity, hard hats, getting tradies into work, is crucial and then the direct and indirect jobs will be vital to Victoria's recovery," he said.

25 percent of the homes will be built in regional Victoria, with the package set to deliver 9300 new social housing homes and replace 1100 old public housing units. 

The first six tenders will be released this month and the government plans to have 6000 homes under construction within 18 months.

"Tradies, firms large and small, knowing that they've got a secure and a massive pipeline of work over these next four critical years as we not only repair the damage of this pandemic but deal in a really meaningful way with some of the weaknesses that it has exposed," Mr Andrews said.

Community Housing Industry Association Victoria chief executive Lesley Dredge said the project represented "an exceptional turnaround" for the sector and those in need of housing.

The government has pledged the new homes will meet 7-star efficiency standards.

Premier Daniel Andrews said the investment would “change lives (by) giving thousands of Victorians the security and stability of a home, and tens of thousands of Victorians a job”.

For more market insights, click here.