Victoria’s latest budget has provided some housing wins, but left many in the construction sector feeling there were missed opportunities.
The state budget has delivered wins for Victorians struggling to keep a roof over their head, but left industry groups lamenting a missed chance to support home building and upcoming market reforms.
An $860m fund over five years to support the development of 7000 new social and affordable homes to be built across the state over the next 10 years was the biggest spend for property – though was announced late in April.
Community Housing Industry Association Victoria chief executive Sarah Toohey welcomed the funding boost for social housing, noting they were “thrilled” to see the Big Housing build’s work continued — though disappointed they had not further funded specialist mental health supported homes recommended in a 2021 Royal Commission.
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There was an additional $47m funding boost for housing support including $26m to help those sleeping rough to access outreach services, with nine new outreach teams, and another $15m for supportive housing sites across cities from Melbourne to Mildura and Shepparton.
The final $6.1m will go to the Tenancy Plus program, which supports social housing tenants at risk of becoming homeless.
The government has also estimated $32.7m will be spent on extending a stamp duty concession scheme for off-the-plan property purchases through to April 21, 2027.
While it is hoped a typical $30,000 saving will encourage more new home sales, it is a cost that will be passed on in part to taxpayers as far as the 2029-2030 financial year as it pays out when homes are completed — sometimes years after buyers sign a contract of sale.
Victorians at risk of homelessness are among the big winners from the budget.
There’s also a $15.6m top up to the state’s 10 Year Plan for Melbourne’s Greenfields, intended to generate 180,000 more family homes as it completes Precinct Structure Plans.
Another $11m is intended to ensure planning legislation and systems make decisions faster, while a further $9.8m will continue to fund the Development Facilitation Program that fast-tracks major housing projects.
Planning minister Sonya Kilkenny said the state was currently building thousands more homes than any other in the nation, and their reforms were “making it easier to deliver them”.
But on Monday, Australian Bureau of Statistics data showed the number of new homes being approved across Victoria fell from more than 56,300 in the 12-months to March, 2025, to just 54,687 for the same period ending at March 30 this year.
Victoria’s new housing industry is facing an uphill battle as they struggle to generate increases in construction at a time when building costs are hurting sales.
Charter Keck Cramer national research director Richard Temlett said while stamp duty concessions for off-the-plan projects could work, they had yet to do so since the Victorian government implemented the program – and that they needed to extend them to recently completed homes as they had during the pandemic.
“It’s a well-intentioned policy that could actually work, but not in the current context,” Mr Temlett said.
Industry groups from the Urban Development Institute of Victoria to the Property Council had slammed the budget within hours of its release as a missed chance to reform property taxes and to take initiatives to grow the state’s housing supply.
HIA Victorian executive director Keith Ryan said the feedback they had from members was that “confidence is pretty much shot” and demand for homes would not pick up this year without the government having expanded the $10,000 First Home Owner Grant or taking other steps to stimulate the sector – which did not occur.
The budget papers revealed a range of multimillion-dollar spends to support housing and new home building — but missed major necessities. Picture: Asanka Ratnayake/Getty Images.
The budget also includes $16m to support the implementation of building industry registration and licensing requirements.
Housing and Building minister Nick Staikos said Victorians deserved homes where they felt “comfortable and safe”.
Further government plans to tackle underquoting with changes to how homes can be auctioned, requiring the disclosure of reserve prices seven days ahead of the planned sale date, as well as intentions to force sellers to disclose prices, were touted in budget papers.
But there was no mention of additional funding for Consumer Affairs to support their implementation or enforcement.
Real Estate Institute of Victoria chief executive Toby Balazs said they would have liked to see government funding to support major changes to the auction and home sales market later this year.
Industry groups have said to get more homes built, significant reform to property taxes are needed — but were not in the budget.
“If the funding is not there, it makes what is a difficult job meeting the regulatory requirements even harder,” he said.
Property Investment Professionals of Australia chair Cate Bakos said a lack of further funding for the taskforces that enforce the government’s new rules was “an issue”.
“You can’t easily predict what agents will do, but they will work out how policed it is,” she said.
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