Housing Victorians

Victoria is facing a housing crisis that is systemic rather than cyclical. Housing has shifted from being treated as a foundation for living and livelihoods to a speculative asset class, with policy and investment often serving the interests of developers, financiers, and construction lobbies rather than communities.This has created an environment where affordability, diversity, and stability are eroded. Homelessness and marginal housing situations are rising, younger generations face locked-out futures, and governments’ piecemeal responses risk entrenching inequality. At the same time, promising opportunities – including better utilisation of existing housing, prefabricated housing and new financing models — are held back by weak regulation, lack of political will, and misdirected incentives.

Our platform underscores our commitment to the following five points:

1. Put homes first, not speculation: We’ll push the Government to treat housing as a human right, curb land banking and tax settings that keep nearly 100,000 homes empty or under-used, and redirect incentives toward long-term, secure homes for Victorians.
2. Deliver the social and affordable housing Victoria actually needs: We’ll call for a genuine planto meet the 80,000-home social housing shortfall this decade — through both new supply and refurbishment of existing public housing — and link this with wraparound support to end homelessness, not just manage it.
3. Reduce rental stress and protect renters: We’ll advocate for expanding affordable rental supply, strengthening rent fairness measures, and ensuring low-income renters — those most affected by rising costs — are prioritised in policy and investment decisions.
4. Champion diverse, community-guided housing: We’ll press for better housing options acrossVictoria — from medium-density and co-housing to community land trusts — informed by lived experience rather than polarised YIMBY/NIMBY debates or one-size-fits-all development.
5. Lead on climate-ready, sustainable and circular homes: We’ll call for investment in climate-resilient housing, circular construction, modular innovation and stronger planning oversight soVictorians aren’t left with uninsurable, unsafe or inefficient homes as climate risks grow.

• Housing as speculation, not shelter

• The system is built to reward speculation and wealth accumulation over the provision of safe, secure and affordable homes. This includes a growing base of homes used for tourist and short stay accommodation, skewing the balance of affordable housing available for longer-term rentals. Homes are left empty or under-used while tens of thousands wait on social housing lists.

• There is an ongoing rental crisis

• While this is easing faster in Melbourne than in other capital cities, rental prices are still causing financial stress for many households across the city and state more broadly.

• Housing is not yet treated as a human right

• While the government frames housing as a human right, the existing policy undermines this by seeking only to reduce homelessness rather than to ensure everyone has access to housing.

• Speculation and land banking lock up supply

• In metropolitan Melbourne alone, nearly 100,000 homes sit empty or under-utilised, whilst Melbourne leads the nation in mortgage arrears. Across the country, most loans given by the big banks are currently used to finance existing (already-standing) housing rather than investing in new business ventures to expand the economy, or even on new housing supply. We commend the government to addressing this at a state level through vacancy and residential land tax policies, though policy is still missing opportunities to promote ethical and community-based forms of housing investment.

• A social housing mission that misses the mark

• Current government commitments, such as the delivery of 16,000 new homes in partnership with community housing providers, fall far short of the need for 80,000 social homes over the decade. At the same time, opportunities to retrofit and refurbish existing public housing towers are being neglected.

• A shortage of housing trades skills

• A growing shortage of construction workers raises questions on how Victoria will meet the government’s overall housing target over the next decade. A focus on workforce development is needed to provide the diversity of homes needed for a rapidly growing population, especially in metropolitan Melbourne.

• Diversity of housing is lacking

• Aggressive marketing of cookie-cutter greenfield estates and high-rise towers overshadows the need for diverse, locally appropriate housing options. This hinders people’s ability to live close to work, family, and community and undermines public confidence in planning.

• Divisions between YIMBY and NIMBY voices

• The Government’s activity centre rezonings have polarised debate, with residents feeling ignored and young people priced out of their communities. The conversation is framed as binary, when what is needed is a balanced, evidence-based path forward.

• There is a growing need for climate-resilient, environmentally-sensitive housing

• The recently released National Climate Risk Assessment suggested that more than 1.5 million homes will be in the very high risk range by 2050. These homes will likely be uninsurable and unmortgageable due to the frequency of weather events. Victoria’s own inquiry into climate resilience cites a lack of funding in the 2025-26 budget for climate resilient infrastructure. More must be invested to prevent adverse outcomes for Victorians in high risk areas.

• Innovation is missing in delivery

• Opportunities exist for prefabricated, modular, and other rapid-assembly housing to meet demand more quickly. Yet regulatory frameworks, workforce skills, and financing options have not been aligned to bring these solutions to scale.

• Stable opportunities for community wealth-building

• Victoria has failed to consider alternative models to deliver secure and affordable housing. Community Land Trusts (CLTs) offer a proven model for embedding affordability and community control into housing markets. Overseas examples show enormous financial benefits for this type of community wealth-building.

• An opportunity for a world-leading circular housing system

• A mission-oriented approach could establish Victoria as a global leader in sustainable housing. By embedding principles of circular economy into construction and refurbishment, the state could reduce waste, cut costs, and improve environmental outcomes. Crucially, this approach could also underpin the training and upskilling of a new workforce, addressing looming shortages as housing development accelerates. Sustainability here is not an alternative to efficiency but its foundation — enabling equity, viability, and housing as a true social good.

• Unrealised potential of planning reform and new technology

• Emerging tools like artificial intelligence could streamline approvals, but relying on “technofixes” risks further errors and loss of accountability if not embedded within sound planning judgment and regulation.

• Addressing gaps in data: housing need from population growth and affordability

• We should carefully measure and assess the influences of speculation, immigration levels, and other demographic trends / shifts on our housing availability and affordability. This evidence base would provide the clarity needed for the government to work with the federal administration in designing suitable policies and better plan for housing growth.

The Australian Democrats want to open up a new conversation about housing in Victoria — one that recognises housing as the foundation of our lives and livelihoods, not just a speculative asset. We believe Victoria can do better: delivering secure, diverse, and sustainable homes, meeting today’s urgent needs while laying the groundwork for future generations. Our contribution to this conversation is to outline missions and directions that could shape the state’s housing future.

1. Recognise housing as a human right

Begin a statewide conversation about embedding the right to safe, secure, and affordable housing in law — ensuring that future policies are guided by this principle and assessed against reductions in homelessness and housing stress.

2. Meet the scale of social housing need

Highlight that the Government’s 16,000-home commitment falls far short of the 80,000 homes needed this decade. We believe the task requires both new supply and the retrofit/refurbishment of existing public housing towers to ensure stock is fit for purpose.

3. Address homelessness directly

Advocate for policies that link housing supply with wraparound support services, and highlight the need for rapid rehousing and stable pathways out of marginal housing.

4. Address rental stress

Tackle rising housing stress by expanding affordable rental supply, limiting unfair rent increases, and prioritising low-income renters – the group most affected by growing market pressure.

5. Champion housing diversity

Ask Victorians what kinds of housing they want, and advocate for a broader mix — from medium-density in established suburbs to innovative models such as co-housing and community land trusts. Push back on the “one-size-fits-all” marketing of greenfield estates.

6. Explore a sustainable housing construction mission

Put forward the idea of establishing Victoria as a world leader in circular housing development — embedding sustainability, reuse, and zero-waste construction. This could also underpin training and upskilling of the workforce needed to meet future demand.

7. Prioritising climate-resilient, environmentally-sensitive housing

Put pressure on the Government to adopt the recommendations of the Victorian Parliament’s Environment and Planning Standing Committee’s inquiry into climate resilience, including adequate funding for climate resilience, which was lacking from the 2025-26 budget.

8. Rebalance taxes and incentives

Open up a debate about discouraging land banking and speculation through tax reform, and redirecting incentives toward community wealth-building and sustainable investment.

9. Streamline planning while safeguarding quality

Encourage reforms to planning approvals that balance efficiency with accountability. Explore new tools, including AI, but only where guided by professional expertise and community input.

10. Locate housing close to jobs and services

Emphasise the importance of well-located housing in activity centres, transport corridors, and regional towns, alongside investments in local infrastructure and services to sustain liveable communities.

Housing should not be solely shaped by the interests of powerful developer lobbies or technocratic approaches to infrastructure delivery. By opening up new conversations, the Australian Democrats want to show that Victorians can imagine and demand better — a housing system that is fairer, more diverse, and genuinely sustainable.

Addressing homelessness and realising housing as a human right

Victoria’s housing crisis is real, measurable, and we argue, the result of several policy settings, not just supply. In metropolitan Melbourne alone, nearly 100,000 homes were empty or underused in 2023, more than double the number of households waiting for social housing (Prosper Australia, 2024). This reflects a system that rewards speculation and capital gains while people are left without shelter. Tax settings have incentivised holding housing as an asset, prioritising private wealth accumulation over its basic function as a home, and ignoring opportunities for mutual and community wealth building.

The scale of social housing need is equally stark. The sector agrees that 80,000 social homes are required over this decade, yet the Government’s current commitment to 16,000 new homes in partnership with community housing providers falls well short of this mark (Homes Victoria, 2025). Addressing the crisis requires both building new homes and refurbishing existing public housing towers, ensuring stock remains safe, sustainable, and fit for purpose.

One of the primary purposes of social housing must be to facilitate the end of homelessness. The website of the Attorney-General’s Department contains a public sector guidance sheet on the right to housing. One of the opening lines on this webpage states that “everyone has the right to an adequate standard of living including … housing” (Attorney-General’s Department, n.d.). It is notable that the Victorian Charter of Human Rights and Responsibilities Act (2006) does not include any provisions related to housing. This Charter acts as a “form of insurance” for other civil human rights, but leaves one of the most basic, housing, uninsured by a government which is in the best position to provide it (Victorian Equal Opportunity and Human Rights Commission, n.d.). The Charter of Human Rights and Responsibilities Amendment (Right to Housing) Bill (2025), which proposes a human right to housing, is currently in the Legislative Council. This Bill must be passed, and the Government must be compelled to act upon its mandate once given royal assent.

Importantly, the State Government’s 2018 Homelessness and Rough Sleeping Action Plan is still its main program, despite promising only 6,000 new homes to house Victoria’s estimated 30,660 homeless population (CHS, 2023). The 2025-26 budget papers show that in excess of 2,000 homes will be built over the next financial year, but the Victorian Council of Social Service (VCOSS) states that a target of 7,990 homes per year is required over the next decade to meet demand (VCOSS, 2025). This essentially means a four-fold increase in annual output is required to meet the bar set by one of Victoria’s peak bodies for homelessness. By framing housing as a human right while implementing a policy that goes nowhere near eliminating homelessness, the Government effectively concedes failure from the outset (Kohler, 2023). Admitting this inadequacy and committing to ending homelessness is the only way effective and lasting change will be achieved.

Rising rates of housing stress and homelessness, particularly among women, young people, and older renters, highlight the inadequacy of current measures. Evidence consistently shows that pairing secure housing with wraparound support services offers the most effective pathway out of marginal housing, especially, for survivors of domestic violence (Sullivan et. al., 2023).

Improving Social Housing Pathways for Better Outcomes

Victoria’s social housing system must be reoriented to support person-centred housing pathways that deliver security, stability and long-term wellbeing. AHURI’s recent inquiry found that while demand for social housing is rising, access has narrowed to only the most acute cases, leaving many vulnerable people stranded on long waitlists or in unsuitable housing (Muir et al., 2025). Application processes can be distressing, and short-term interventions like private rental assistance often fall short – with over half of assisted households unable to sustain their tenancies (Muir et al., 2025). Rather than simply managing transitions between housing types, the system must support individuals based on their lived experiences and goals. With major new investment in supply, there is now an opportunity to reshape social housing as a platform for stability, dignity and opportunity, not just a last resort.

To achieve this, Victoria should adopt best-practice, person-centred reforms that prioritise housing security and integrated support. AHURI’s research highlights that many tenants face complex challenges and need coordinated services to sustain housing – but trust and success rely on the foundation of a secure home (Muir et al., 2025). Programs like Victoria’s Tenancy Plus already demonstrate this approach, working with tenants to co-design support plans that connect them to health, employment and community services. Strengthening tenancy sustainment mechanisms and offering pathways out of social housing when appropriate – such as through an improved, targeted rental assistance program – can further improve outcomes for tenants while freeing up stock for others in need. These reforms must be backed by co-designed policy, clear rights to housing support, and improved system coordination to ensure that social housing offers not just shelter, but a fair and supportive pathway to a better future.

Another important component of this is establishing poverty discrimination laws in Victoria, to enshrine legal rights of people who are homeless or in transitional housing to attain secure jobs, income support and other vital protections, as identified by legal practitioner Farzana Choudhury, in her 2019 Churchill Fellowship report. This should be paired with a state review (of state laws, policies and delivery partners) of potential regulatory barriers, which are preventing homeless, marginally housed and lowincome households from receiving housing and crisis support (including for instance, accounting for intersectional factors like race, culture, sexual orientation and expression) (Choudhury, 2019).

Addressing speculation

The Government’s approach to land banking and speculation to date has been reactive, focusing on piecemeal changes to land tax and stamp duty. Progress has been made, with the expansion of the Vacant Residential Land Tax (VRLT) and its planned extension to long-term undeveloped land from 2026. The problem lies in its effectiveness and enforceability. Approximately 5% of eligible properties were assessed in 2023, and those who are taxed were already happy to forego rental income, so a larger tax bill is unlikely to affect how they used the property (ABC News, 2024). For prospective first home buyers, stamp duty has often been seen as a perverse barrier to entry. The Government has reduced this tax for off-the-plan purchases of apartments, which reduces the upfront cash required, but simultaneously increases competition from investors with different goals to owner-occupiers. Importantly, pushing home buyers to purchase properties under a strata plan can mean purchasing a property at an inflated price due to hidden marketing fees, but then being subjected to stagnant capital growth due to the already oversupplied market for apartments in Victoria (Amari, 2025). This leads to the conclusion that expanding stamp duty concessions positively reduces upfront costs for first home buyers, but risks entrapment and increased competition. As such, abolishing stamp duty outright (rather than increasing concessions) and expanding the VRLT accordingly is the mechanism by which home buyers’ tax obligations can be re-profiled to aid housing affordability (Martin, 2017).

Victorians should also consider alternative land ownership models to those which have caused the affordability crises being experienced. Models such as Community Land Trusts (CLTs), more common to the US and the UK, place ownership of the land component of a property in the hands of a not-for-profit legal entity, while ownership or long-term leasing of the building is by an individual household (AHURI, 2018). One prominent case study is London CLT, an organisation which sought to deliver affordable homes as a legacy of the 2012 Olympic Games. Its first project, on the site of a disused hospital, saw two-bed homes sold at £350,000 (~AU$700,000) less than at market value (Community Land Trust Network, n.d.). The CLT now has many projects across London, one of the world’s least affordable cities. Compatibility between this case study and Victoria’s plight is clearly observed when considering the incredibly high land costs in cities and plethora of complex disused sites.

Addressing rental stress in Victoria

Rental stress occurs when households spend more than 30% of their income on rent, leaving little for essentials like food, transport, and healthcare. In Victoria, it overwhelmingly affects low-income households, who face an acute shortage of affordable homes. AHURI research shows that as of 2021, over 80% of low-income private renters were in rental stress (Pawson et al., 2024). Meanwhile, the share of high-income earners renting has grown sharply – from 8% in 1996 to nearly 24% in 2021 – occupying a large portion of affordable stock and pushing lower-income renters into crisis (AHURI, 2024). This mismatch is worsening inequality: those with the least are paying the most, often for substandard or insecure housing.

The Victorian Government’s recent rental reforms have made important progress, banning “no-fault” evictions, improving property standards, and extending notice periods for rent increases (Department of Families, Fairness and Housing Victoria, 2023). These protections give renters more security and align with values of fairness and stability. But without tackling affordability head-on, protections alone won’t solve the crisis. For low-income households, rising rents and stagnant incomes mean that even legally secure tenancies can become financially unsustainable. Rental stress is no longer just a fringe issue – it is a structural problem that requires a structural solution (Pawson et al., 2024).

To reduce rental stress, we support targeted investment in affordable rental supply, alongside stronger rent fairness mechanisms. This includes expanding social and community housing, incentivising affordable builds through inclusionary zoning (expanding the existing Government’s pilot program), and ensuring financial supports like Commonwealth Rent Assistance keep pace with rising costs (Pawson et al., 2024). We also support limits on unreasonable rent increases and robust enforcement of new rental standards (AHURI, 2024). By prioritising low-income renters in policy design, Victoria can ease stress, prevent homelessness, and ensure that renting remains a viable, fair, and secure housing option for all.

Getting it right with housing diversity

Current debates over the Government’s activity centre rezonings show how fractured the conversation about density has become. Communities often feel ignored as infrastructure struggles to keep up with development, while younger people are priced out of the suburbs where they grew up. This polarisation between “YIMBY” and “NIMBY” voices is symptomatic of a system that has failed to ask the right questions — not about whether people accept what the market already delivers, but about what they actually want from their homes and neighbourhoods and having open conversations about what this could look like.

We propose to co-design an extensive housing lived experiences program with communities to gather real-world housing experiences, needs and aspirations across diverse housing types and tenures. This extensive engagement – possibly via surveys, interviews, focus groups and citizen assemblies – ensures policy and design decisions reflect residents’ lived experiences. This could build from projects like RMIT’s Living Together, involving in-depth post-occupancy interviews with residents, architects, and developers of new housing projects (after 6–12 months of living there) to let participants “paint a personal picture of their world” in describing their homes (RMIT, 2022). This approach produced rich insights on what worked and what didn’t, identifying design improvements to benefit residents and communities.

Similarly, Canada’s national housing strategy consultations in 2016 engaged over 7,000 citizens, bringing “a wide range of opinions” and innovative ideas to the table - from affordability struggles to design preferences – and helped to build public understanding and support for housing reforms (Canada Mortgage and Housing Corporation, 2018). Such an initiative in Victoria, could draw on best practices from deliberative housing models (like Nightingale Housing’s “deliberative design” approach in Australia) and collective housing research (e.g. RMIT’s Living Together project) to ensure inclusive, representative input. The findings from this program should directly inform future housing strategies, so that policies and developments align with what people actually need and aspire to in their homes.

Environmentally responsive housing

The Australian Climate Service (ACS) (2025) recently released the National Climate Risk Assessment (NCRA), highlighting that by 2050 more than 1.5 million homes would be in the “very high risk” range (p.3). The coastal LGAs of Victoria are estimated to be among the worst affected. In August 2025, the Victorian Parliament’s Environment and Planning Standing Committee (EPSC) (2025) released its inquiry into climate resilience. This inquiry highlighted that in many cases insurance for properties may be completely unavailable by 2050, as risks to properties are deemed too high. Since every mortgage contract in Australia obliges the holder to have insurance, there will be catastrophic outcomes for high risk homes in Victoria, which would by definition be unmortgageable, since insurance companies do not insure against likely events.

Richard Denniss of The Australia Institute has stated that these events are “going to do far more to reduce the housing supply than every NIMBY group in Australia could hope to achieve”. The authors of the recent Victorian inquiry stated that progress under the Built Environment Adaptation Action Plan 2022–2026 has slowed due to a lack of funding in the 2025-26 budget (EPSC, 2025). Completing this will be vital to guiding investment to bolster and future-proof local infrastructure and natural hazards, since these are our primary defences against the effects of increased drought, flooding and bushfires. Equally, the risks highlighted by insurance figures also underscore a need for future housing to be planned, designed and constructed in ways which avert climate hazards like floods and bushfires, address urban heat island through vegetation provision, and support resilience through other extreme weather events like heatwaves.

Housing construction opportunities

There are also opportunities that Victoria has not yet seized. Prefabricated and modular housing has been proven overseas as a rapid and cost-effective solution in delivering medium density housing, but regulatory and workforce barriers hold back its wider use (Ziaesaeidi, 2024). Similar examples from abroad show that embedding circular economy principles into housing could reduce costs, cut waste, and open up new pathways for workforce training at scale (Horne et al. 2023). Similarly, new technologies such as artificial intelligence have potential to improve efficiency in the planning system, but they must be guided by professional judgment to avoid compounding errors (MAV, 2025).

To accelerate sustainable and affordable housing in Victoria, we propose further investment in circular construction and renovation, particularly through public and social housing pilot projects. Circular construction minimises waste and carbon emissions by designing buildings for disassembly, material reuse and energy efficiency (Pan and Sidwell, 2021). Examples like the Netherlands’ Super Circular Estate – where a 10-storey housing block was deconstructed and materials reused for new homes – show what’s possible (Zhang et al., 2021). In Victoria, companies like Ecoliv and Modscape are already building modular homes using recycled and low-carbon materials, passive design, and off-site fabrication, demonstrating that circular housing is achievable, scalable and low-impact (Australian Design Review, 2016).

These outcomes are amplified when paired with modular and adaptable construction methods, which improve speed, cost-efficiency, and design flexibility. Extensive international research shows that modular housing can reduce build times by 30–50%, lower costs by 10–20%, and significantly cut material waste – especially in public and affordable housing contexts (Zhang et al., 2021; Loosemore et al., 2020). Built in controlled factory settings, modular homes achieve higher quality, greater resource efficiency, and better health and safety outcomes for workers compared to traditional construction methods (Yosia Sunindijo et al., 2022). Adaptable by design, modular systems also allow for future expansion, reconfiguration or relocation with minimal disruption, extending the life and value of each home (Pan and Sidwell, 2021). Countries like Sweden and Japan have scaled modular construction to deliver thousands of high-performance homes (Ellen MacArthur Foundation, 2024), and Victorian innovators like Ecoliv and Modscape are showing how it can work here – faster, cleaner and smarter (Australian Design Review, 2016).

To embed these practices across the housing sector, Victoria must also invest in workforce development and manufacturing capacity. Initiatives like the Future of Housing Construction Centre of Excellence (Melbourne Polytechnic) already underway provide a strong foundation. With tailored training, certification pathways and industry partnerships, Victoria can grow the skilled workforce needed to deliver modular and circular housing at scale – supporting jobs, innovation and a more sustainable built environment.

The evidence points to a housing system that is failing to meet need, but also to meet the opportunities that could be unlocked if policy were reoriented towards housing as a foundation for living and livelihoods, rather than as a vehicle for speculation. This is the conversation the Australian Democrats seek to open.

Our platform is grounded in the belief that secure, affordable, and sustainable housing is essential to individual freedom, economic participation, and community wellbeing. A system that supports people – through strong renter protections, expanded social and affordable housing, circular construction methods, and person-centred support services – is not just more just, but more resilient. These changes reflect our values: fairness, through equitable access to housing; opportunity, by creating the stability people need to thrive; and long-term responsibility, through environmental sustainability and intergenerational equity. By reshaping the purpose of housing policy around people, not profit, we can build a future where every Victorian has the foundation they need to live well, participate fully, and plan for what’s next. This is not just a policy agenda – it’s a values-driven vision for a fairer, stronger Victoria.

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