Federal election: Labor announces plan to build 100,000 new homes for first-home buyers

In the lead up to the federal election, the Labor government has announced a $10 billion investment to build up to 100,000 new homes for first-home buyers.  

According to the government, if re-elected, it will partner with state developers and the construction industry to build these new homes, which will be reserved for purchase by first-home buyers.  

To carry out the plan, the government will look at government-owned land that is vacant or underutilised and enable states and territories to fast-track land release, upzoning and planning approvals.  

The $10 billion investment will be made up of $2 billion in grants and $8 billion in zero-interest loans or equity investments primarily to states and territories. These states and territories will be required to match the $2 billion contribution. 

Construction for these projects is expected to start between 2026 and 2027, with buyers moving in from 2027 to 2028.  

The government also announced an expansion of the First Home Guarantee, which could see first-homebuyers eligible to buy a home with a five per cent deposit and avoid lenders mortgage insurance.  

“Young Australians are bearing the brunt of the housing crisis, and our government is going to step up to give them a fair go at owning their own home,” minister for housing and homelessness Clare O’Neil said.  

“We want to help young Australians pay off their own mortgage, not someone else’s.” 

The announcement follows the 2025 federal budget which saw $800 million dedicated to first-home buyers and $54 million for the prefabricated and modular housing industry. 

Industry reaction 

Building and construction bodies welcomed the announcement, with the Property Council of Australia noting it as a “game changer” for new housing supply.  

“100,000 new homes will be a big boost to our welcome and ambitious 1.2 million new homes target,” Property Council chief executive Mike Zorbas said.  

“We look forward to early industry involvement in the scheme design to make sure the benefits are maximised.” 

The government will identify idle land to expedite land release, upzoning and planning approvals. Picture: Getty

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The Urban Development Institute of Australia said the measure fell in line with its recommendations to fast-track housing in the lead up to the election.  

“The cornerstone of any good policy in this housing crisis is more homes. The creation of 100,000 homes, reserved for first home buyers, is a big step in the right direction,” UDIA president Col Dutton said. 

Master Builders Australia said the announcement strengthens the relationship with states by funding efforts to boost home delivery through a planning reform blueprint.

CEO Denita Wawn also noted that an investment into upskilling the construction industry was a “key missing piece of the puzzle”.  

“Supporting first home buyers is only meaningful if we’re also making it easier to build the homes they want to live in,” Ms Wawn said.  

“We need a coordinated workforce plan that includes investment in training, incentives for small business employers, and a dedicated construction pathway for skilled migrants.”   

Where will these 100,000 new homes be built? 

The Labor government said it will look at underused government-owned land and work with states and territories to fast-track land release, upzoning and planning approvals. 

Who is eligible to buy these homes?  

These homes will only be available to first-home buyers.  

Is there an income limit for the 100,000 homes?  

It’s not clear if there is an income limit for those first-homebuyers wanting to purchase these new homes.  

When will construction begin? 

Construction is expected to begin between 2026 and 2027 with buyers moving in from 2027 to 2028.  

Are you interested in buying or building new? Check out our New Homes section.