HAFF Round 3 announced with new streams, clearer timelines and bold investment in the future

The next chapter in housing

Australia’s housing crisis continues to demand urgent, coordinated action. With escalating rental prices and a persistent shortage of social and affordable housing, the Federal Government’s Housing Australia Future Fund (HAFF) and National Housing Accord Facility (NHAF) remain pivotal mechanisms to address this challenge.

Housing Australia has announced Round 3 of the HAFF and NHAF will open in late January 2026, and will continue to provide critical funding to help deliver the remaining 21,350 social and affordable homes to achieve the national target of 40,000 new homes by 2029.

This funding builds on the previous two rounds, which have already committed 279 contracts, supporting 18,650 homes, with 889 completed and 9,501 under construction.

Round 3 explained

Round 3 is designed to accelerate delivery and deepen partnerships across the housing sector to deliver 40,000 homes by 2029, and Housing Australia have confirmed that Round 3 will offer:

• Funding packages of various sizes encouraging industry partnerships led by Community Housing Providers (CHPs) and other eligible funding recipients
• Partnership opportunities for states and territories to collaborate on large-scale housing projects, leveraging their land, planning powers, and funding to accelerate delivery of social and affordable homes
• $600 million in dedicated funding for First Nations housing organisations, supported by a new First Nations Concierge Service.

Streams within Round 3

Unlike previous rounds, the funding in Round 3 will be more targeted. While the funding process will be the same for all of the target areas, these streams allow a focus on particular areas. The four streams are as follows:

1. First Nations stream

The First Nations stream will fund social housing, with $600 million available to support proposals that contribute to the national agreement on Closing the Gap.

2. Housing diversity stream

The housing diversity stream exists to ensure a balanced mix of social and affordable housing across different locations and project types, ensuring that both metro and regional communities benefit from new housing supply. It targets medium-to-large scale developments that can deliver housing efficiently and at scale, while maintaining diversity in location (metro and regional) and housing type.

This stream will support the creation of 3,750 dwellings, with half of those being social housing, and half being affordable housing. The focus for applications will be on efficiency and scalability, and the minimum sizes of application will be 200 dwellings (for metro/mixed development areas), or 50 dwellings for regional development areas.

3. State and territory government stream

This stream is designed to leverage the unique role of state and territory governments in housing delivery. These governments control land, planning approvals, and have existing housing programs. This dedicated stream ensures large-scale projects can be delivered in partnership with jurisdictions that have the capacity and authority to accelerate social housing supply.

The stream will support the delivery of social housing (represented by 90 per cent of funding in this stream) and affordable housing (represented by 10 per cent of funding in this stream). The funding will be delivered from 2027 to June 2029, with fixed availability payments and fixed concessional loan options available. Registered CHP partners will also have HAFF Senior Debt available, and all applicants will be capped to apply to a maximum of two metro and one regional per application.

4. Partnerships at scale stream

The partnerships at scale stream is designed for institutional investor partnerships, and aims to support the development of 8,000 dwellings, with 90 per cent of those being affordable housing. These applications will be for large developments with a minimum of 500 dwellings and a maximum of 2,500 dwellings per application. This funding also includes ceiling availability payments, a fixed concessional loan, and registered CHP partners will have HAFF Senior Debt available. It’s important to note that housing enablers (e.g. developers) must partner with an eligible funding recipient to be part of this scheme.

The application process

The application process will be an open and on-demand, two-stage application process to support faster decision making.

The Australia Government will also be streamlining all social and affordable housing funding products administered by Housing Australia under a single Housing Australia Future Fund (HAFF) brand over the coming months. The aim is to improve coordination, strengthen engagement with states, territories, industry and the community housing sector, as well as making the application process easier to navigate.

Timelines from submission to approval

A key concern for applicants in round 1 was ambiguity around the timelines between application to the approval of funding. Housing Australia has confirmed clear timelines so applicants can be clearer on what to expect, which is a gamechanger for applicants:

• The detailed expressions of interest (EOI) call will be released at the end of January 2026. There is no fixed closing date as yet, and EOIs will be assessed on a rolling basis - once dwelling allocation is exhausted, funding will close.
• The EOI outcome will be communicated to applicants approximately four weeks after submission, and a more detailed application will need to be submitted approximately eight weeks after that (i.e. eight weeks following EOI submission).
• Funding approval can be expected between eight and twelve weeks after the EOI submission, assuming the detailed application has been provided on time.

Significant changes between the EOI and the detailed application may require applicants to withdraw their application and resubmit, so this could cause delays if there are significant differences.

How BDO can help

This new round of funding provides a huge chance for applicants to make a positive mark in the country’s housing crisis and help address critical shortages of social and affordable housing.

For organisations in the real estate and construction sector, now is the time to prepare for applications and explore partnership opportunities.

Our real estate and construction experts can help you navigate the complexities of HAFF funding, from structuring arrangements, managing financial and tax implications, financial modelling support and broader real estate advisory services. If you’d like support with your housing projects or HAFF applications, contact us today.