HAFF funding announced - winners and losers

After being inundated with applications to fund over 50,000 homes in 673 projects, Housing Australia have finally announced the projects that will be funded in the first round.

Although a full list of projects has not been released 165 projects nationwide have been selected which will deliver 13,742 homes (4,220 Social Housing units and 9,552 Affordable Housing units).

Housing Australia have advised that they will use the outcomes and market evidence for the first round to inform and shape future rounds. Hopefully this will provide guidelines indicating the parameters around which projects have a high chance of success and lead to a significant reduction in the number of applications. Round 2 is expected to open in the first quarter of 2025.

When selecting projects to put forward for round 2 it is useful to understand some of the statistics from round 1.

• Approximately 84% of homes approved are apartments the great majority being one and two bedrooms.

• Over half of the approved projects were for fewer than 50 homes.

• very few projects (5%) are due to be completed this year. Indicating very little completed stock was included.

Feedback from Community Housing providers and developers involved in round 1 submissions suggest:

• Projects that are permit approved with documentation well advanced have had more success.

• A turnkey arrangement that minimises risk has been required. A fund through model followed by some of the larger Community Housing Providers was not supported.

• Price point has been critical. Although with some regional variation, a sub $700k unit price appears to be the norm.

• Little information at this stage is known on the level of availability payments that was required for success (funding will be provided predominantly through annual payments per unit to CHP's). A financial model that indicates what availability payments should cover would significantly help CHP's.

Currently Community Housing Providers are absorbing the feedback from their round 1 applications as they now seek suitable projects to include in round 2 submissions.

If you would like further information or to discuss including a project in a round 2 application, feel free to contact us.