Sarah McKenzie, Acting Executive Director
The National Housing Supply and Affordability Council’s State of the Housing System 2025 Report, published in May this year, paints a grim picture of the state of Australia’s housing system. It is more than a housing crisis, it has become a full-scale national disaster. It is chronic and worsening, and requires an emergency response. While the scale of the problem is immense, Australia has a strong track record of effectively navigating emergencies, and it is time to bring that mindset to the task of fixing the housing crisis. Framing Australia’s housing disaster as a national emergency does more than describe its scale, it creates the conditions for action. Emergencies cut through bureaucratic inertia, legitimise large-scale interventions, and generate the political will needed to respond at speed and scale. If we treat our nation’s housing problems as an emergency, we can mobilise the same urgency, coordination and investment that Australians expect in times of national disasters.
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Standing at the podium at Per Capita’s September 2024 John Cain Lunch Series, former Supreme Court judge Kevin Bell AO delivered a sobering reflection on the state of Australia’s housing system. Bell called for a different framing of its causes, its consequences, and the potential solutions that could help us navigate our country out of the housing crisis. But, to Bell, the word crisis no longer captures the scale or persistence of what we are facing. A crisis is something that happens from time to time in an otherwise well-functioning system, but our housing problem is chronic: it has become the system. Bell was right when he said that what we are facing is a national housing disaster and, if left unaddressed, it risks becoming a housing catastrophe.
Reading last month’s report from the National Housing Supply and Affordability Council, State of the Housing System 2025, it’s easy to see this trajectory toward catastrophe. In 2024, the supply of new housing reached close to its lowest point in a decade. The number of new dwellings fell short of underlying demand by 68,000, compounding a severe supply shortfall that has been building for years. At the same time, more than half of lower-income households are experiencing rental stress – severe rental stress is at its highest level in ten years – and waitlists for public housing remain near record high levels. As homelessness continues to rise, more people are seeking help from homelessness services and, with many homelessness support providers at capacity, the number of people in dire need and going unassisted is growing. There are people who desperately need a roof over their head, but there are simply not enough non-market dwellings to place them in, and the days in which government support payments or even a full-time minimum wage allowed access to market-rate rentals are long gone in much of Australia.
While the stock of social housing has increased marginally in absolute terms, it continues to decline as a proportion of total dwellings. Even with commitments under the Housing Australia Future Fund (HAFF) and the Federal Government’s $43 billion commitment through its Homes for Australia plan, structural constraints are strangling supply. After decades of neglect, substantial additional investment and reforms to our housing system will be needed to ensure Australia meets its international responsibility to ensure access to adequate housing as a fundamental human right.
This is an emergency: a housing emergency. But it is also a public health emergency, a human rights emergency, and a brake on economic productivity. It requires an emergency response.
Fortunately, this is where the silver lining gleams through, because Australia is really good at dealing with emergencies.
Australian governments have shown time and time again that when disaster strikes, they can act swiftly, creatively and effectively. In the 1970s, when Cyclone Tracy devastated Darwin, destroying 80% of the city’s buildings and rendering half its population homeless overnight, the Commonwealth established the Darwin Reconstruction Commission tasked with rebuilding the city within five years. It completed the job in just three.
In 2008, when the global financial crisis hit, triggering the deepest worldwide recession since World War II, the Australian Government cushioned the impact through immediate fiscal reforms and a bold stimulus package. Targeted cash payments and infrastructure spending helped preserve jobs, sustain credit flow and shield Australia from the same long term economic harm experienced in other parts of the globe. Australia commenced construction of over 20,000 social homes from 2008 to 2010 in response to stimulus packages, more than the following 8 years combined. As Minister for Housing during the Rudd Government, Tanya Plibersek played a key role in driving the Social Housing Initiative, which was part of the federal stimulus response to the GFC. This included encouraging best practice in state and local government planning systems and pushing for faster, more consistent development of assessment and approval processes to accelerate the delivery of urgently needed housing.
In early 2020, when COVID-19 arrived on Australian shores, the Federal Government again responded quickly. Alongside a coordinated national health effort, the Federal Government launched the largest fiscal stimulus package in Australian history, including the JobKeeper wage subsidy, which supported nearly one in three workers to remain in the workforce. The reductions in poverty and housing stress for JobSeeker recipients were dramatic and immediate, and state governments acted fast, implementing eviction moratoriums and introducing emergency measures to address homelessness.
Australia has faced bushfires, floods, recessions and pandemics, and in each case the Australian Government has led decisive national responses. It has acted swiftly, committed significant public funding, coordinated efforts across jurisdictions, and made bold policy decisions to protect the lives and livelihoods of its people. We can respond in the same way to the housing crisis, if we are willing to recognise it as the national emergency it truly is.
Treating our housing problems as an emergency is not a new idea to Australia. We have mobilised boldly around housing before. In the aftermath of World War II, when Australia faced a severe housing shortage, the federal government treated it with the seriousness it demanded. In April 1943, the Curtin Government established the Commonwealth Housing Commission within the Ministry of Post-war Reconstruction. The five-member commission issued three reports, laying the groundwork for a national response to housing needs.
In its Final Report, it made its view clear: ‘We consider it essential that, in Australia, the governments should accept responsibility for ensuring adequate housing of the people, especially the low-income group’. The Commission also emphasised the need for national leadership, arguing that the Commonwealth should supplement the housing activities of state governments, and called for decisive federal action to lead the way.
The approach wasn’t just about building more houses, it was about building a nation. At the time, poor housing was recognised as a threat to physical and mental health, to national morale, and to social cohesion. Housing was framed not only as one of the country’s greatest problems, but as a key part of the solution. When introducing the legislation to implement the Commonwealth State Housing Agreement in 1945, Minister for Postwar Reconstruction, John Dedman, highlighted the urgency of this ‘important piece of social legislation…[to] provide means whereby a full-scale attack can be made on one of the worst of our social evils, namely, the bad housing of the Australian people’.
Between 1947 and 1954, Australia increased its housing stock by 50%, outpacing population growth by nine percentage points. State and federal governments contributed to a quarter of that growth through ambitious policies, which aimed to rapidly expand supply and open pathways to home ownership.
Today, while the Australian Government has taken some bold actions, like the HAFF, the National Housing and Homelessness Agreement, and its successor, the National Agreement on Social Housing and Homelessness, it is not enough to reverse decades of neglect. The key challenge now is to ensure a consistent and coordinated national effort. That means a nationally agreed social housing target alongside consistent planning and zoning principles, coordinated by the Federal Government.
Seeing housing as a national emergency transforms what is politically possible. Emergencies demand coordination, focus, and swift action. They also provide governments with the social licence and the tools to act boldly.
Recent changes to the Federal Ministry provide promising signs. The Housing and Homelessness portfolios have been moved from the Social Services umbrella into Treasury, alongside cities, which had previously sat outside of the cabinet under the Infrastructure umbrella. Housing is being positioned at the center of economic decision-making, an important signal that national leadership may be gearing up to act with urgency.
And they must, because this is much more than a housing disaster; it is a human rights disaster. Australia has ratified the International Covenant on Economic, Social and Cultural Rights (ICESCR), which imposes a positive obligation on governments to progressively realise every person’s right to adequate housing. This doesn’t require UN member States like Australia to build and provide homes for everyone; as the UN High Commissioner for Human Rights has explained, the right to adequate housing includes a range of protections and measures such as preventing homelessness, prohibiting forced evictions, combating discrimination, prioritising the most vulnerable and marginalised, ensuring security of tenure, and guaranteeing that housing is safe, habitable, and accessible. Providing social and affordable housing and tackling growing homelessness is what the right to adequate housing demands of government.
Today, we need more homes for all income groups, but if increasing total dwelling numbers doesn’t come with a consecutive target for increasing non-market housing then the share of social housing will continue to fall. We must ask ourselves, what kind of country are we building? If access to housing depends solely on income and class, it denies the universality of human rights and fails Australia’s obligations under the Covenant.
Upholding human rights is the responsibility of governments, not markets. On the international stage it is the Federal Government who has undertaken duties to ensure the right to shelter, dignity, health, and life. Even before the Covenant existed, this duty was well understood, as demonstrated by the views expressed in that final report from the Commonwealth Housing Commission in 1945.
Social housing is essential infrastructure. It directly addresses homelessness, poverty, poor health, and social fragmentation. Historically, it has been central to national crisis responses: in the post-war recovery, during the Global Financial Crisis, and throughout the COVID-19 pandemic. The 2025 State of the Housing System report makes clear that expanding social housing stock must now be treated with the same urgency.
The scale of the national emergency requires a level of ambition we have seen our national government rise to in the past. Fortunately, some of the architecture for bold action is already emerging. Alongside the relocation of housing to Treasury, the government has made large funding commitments to establish the Advanced Entry Trades Training program to fast-track trades qualification so we have the workforce to build more homes.
This intent must now be matched with strategic, coordinated action with the Federal Government at the wheel to build more houses for those most in need, and to do it fast. This should include:
1. Setting binding national social housing targets
The Federal Government should establish clear, binding targets for social housing growth and tie them to long-term funding agreements. The proportion of social housing in our market has dropped to its lowest share in over 50 years, tumbling by one-third over the past three decades, from 5.6% of housing in 1991 to just 3.8% in 2021. The 2025 State of the Housing System Report recommends a target for 6% share over the medium term, and further long-term targets of 10% for non-market social and affordable housing.
2. Establishing a Commonwealth Planning Authority
Realising the idea of a national planning authority, first proposed in 1945, is overdue. Such a body could guide long-term urban planning, track national progress, align infrastructure and housing needs, and coordinate best practice across states and territories. The 1945 suggestion of a Commonwealth Planning Authority was abandoned on constitutional grounds, but the legal landscape has arguably shifted since then. The Commonwealth has the right to legislate on matters relating to Australia’s international obligations under its section 51 external affairs power. Additionally, in Pape v Commissioner of Taxation (2009) 238 CLR 1, the High Court upheld the use of Commonwealth executive powers pursuant to section 61 of the Constitution in response to a national emergency. It accepted that the Federal Government could act beyond its ordinary constitutional remit, including in areas traditionally reserved for the states, when urgent intervention was needed to protect national stability. This nationhood power justified the stimulus response during the GFC. The same logic could apply today, as Australia faces worsening homelessness, collapsing housing affordability, and rising social inequality as an emergency response to our national housing disaster.
3. Driving a consistent approach towards the introduction of mandatory inclusionary zoning across the country.
While the ability of the Commonwealth to directly legislate measures such as mandatory inclusionary zoning remains constitutionally dubious, Pape suggests it is not impossible. Still, the Federal Government does not need to rely solely on a theoretical interpretation of section 61 to act. It already possesses significant tools to lead through coordination, funding, and national strategy just as it did during the COVID-19 pandemic. It holds powerful levers through funding agreements under section 96 of the Constitution, which can be used to incentivise states to adopt mandatory inclusionary zoning, ensuring private developments contribute to social and affordable housing stock, while respecting jurisdictional authority. Currently only South Australia has a statewide inclusionary zoning scheme, other states approaches are ad hoc. This is essential if we are to meet increased social housing targets.
The Federal Government should use National Cabinet to drive these reforms in cooperation with the states, by beefing up the National Housing Accord with clear targets for social housing tied to funding.
The alternative is to wait for the housing catastrophe to hit with total system collapse: worsening health outcomes, entrenched poverty, growing political instability, mass displacement, and the reversal of all those gains made after WWII, entrenching a real class divide in Australia. That is the cost of inaction.
The lack of affordable, accessible housing for younger and lower income Australians is a national emergency. Recognising it this way is not just symbolic; it is a call to action. It gives the Federal Government both the legitimacy and the obligation to act boldly, urgently, and in the public interest. For justice, for dignity, and for the fundamental and universal rights of Australian people. The soul of a nation lives in the homes of its people. Our very identity and nationhood depend on secure, adequate shelter for all, and it is our federal government who must lead the way.
