A group of independent crossbenchers, led by Allegra Spender, is calling for a major redesign of the federal government’s $3 billion New Homes Bonus Scheme, arguing it will fail to deliver the urgent housing supply needed amid the worst affordability conditions in decades.
Cotality’s latest Housing Affordability Report shows three of four national indicators have hit record highs in 2025, with a new mortgage now consuming 45% of median household income, rental affordability at 33.4%, and a 20% deposit taking around 11 years to save.
The crossbench push – which includes David Pocock, Kate Chaney, Zali Steggall, Monique Ryan, and Nicolette Boele – calls for the scheme to be brought forward and paid in reform-linked stages rather than as a lump sum once states hit long-term housing targets.
Spender said unaffordable housing is now the biggest social issue facing Australia.
“It’s time that the government utilised Keating’s adage ‘Never get between a premier and a bucket of money’ and structured the bonus so that it really drives the changes we need,” she said in a media release.
The group proposes linking payments to actions that directly enable housing supply — such as zoning changes, faster approvals, and investment in enabling infrastructure — to tackle structural barriers contributing to record-high rents and construction costs.
Steggall said improving the design of the scheme would have immediate supply-side benefits.
Fixing the New Homes Bonus “can deliver more homes and bring rents and construction costs down,” she said.
Currently, the ACT is the only jurisdiction on track to meet its housing target and claim a share of the incentive, though even this remains uncertain.
The Property Council has urged the government to double the scheme to $6 billion and bring payments forward, noting the additional cost represents just 0.1% of the 2024/25 federal budget.
Matthew Kandelaars (pictured), group executive of policy and advocacy, said stronger incentives would help states ramp up construction.
“We need to ramp up supply-side initiatives to accelerate home construction," Kandelaars said.
“We’ve warmly welcomed the government’s New Home Bonus initiative, but the payment gateways need to be pulled forward, and states should be rewarded for taking genuine and ambitious actions to lift their housing run rates, even if they don’t quite hit their 2029 target.
“The payoff is significant. If we achieve our national housing goals, renters could save around $90 a week, easing pressure on household budgets.”
He added: “Supply is the main game in making housing more affordable, whether to buy or to rent. Sharpening the well-intentioned housing incentives will go a long way in tackling our housing crisis.”
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