The government will increase the financial capacity of registered housing associations to grow social and affordable housing supply in Victoria.

This initiative will encourage growth in the community housing sector as a whole. 

The community housing sector currently provides social and affordable housing to thousands of Victorians, and with additional assistance from the Victorian Government is well placed to deliver significant growth in new housing.

This will encourage growth of the community housing sector as a whole. The Victorian Government will make $1.1 billion in low cost loans and government guarantees available to registered housing associations commencing in the 2017-18 financial year.

These financial initiatives will establish an environment for registered housing associations to secure finance on more favourable terms. This will increase their capacity to deliver more housing for Victorians in greatest need, particularly when used in conjunction with other reform initiatives. 

How it will work

Revolving loan facility

The revolving loan facility will increase the pool of capital available to registered housing associations by supplementing existing private sector finance. It aims to reduce the cost of borrowing by allowing registered  housing associations to access loans at lower rates than what is currently being offered by the private sector.

Loan guarantee program

A government backed loan guarantee program will reduce risks for lenders as the government will provide guarantees on the repayment of loans (this could be full or partial cover of the outstanding amounts borrowed).

The guarantees will have the advantage of lowering the overall perceived and actual risk of loans to housing associations as the government is essentially guaranteeing repayment of the loans on their behalf, which should result in an uplift in the size and duration of finance, whilst simultaneously lowering the overall cost of borrowing on improved terms.

This will enable housing associations to meet government objectives to grow and maintain social housing for more Victorians in highest need.

Funding and administration

The Victorian Government has provided $2 million for implementation and setup costs associated with the programs, including investigating the financial intermediary.

The program will be administered by the Department of Treasury and Finance and Department of Health and Human Services.

Time frame

The revolving loan facility and loan guarantee program are both ongoing, long-term programs.

How much new housing supply it will deliver

The financial initiatives will enable housing associations to access lower cost debt and for longer terms, unlocking the capacity to grow additional housing supply. The number of houses delivered will be dependent on factors such as the housing market and the financial capacity of community housing organisations.


Guarantees will be allocated to registered housing associations on a competitive basis. Registered housing associations will be eligible to participate in the initiatives, due to strong regulatory framework.

Access to housing

Participating registered community housing organisations will be required to participate in the single Victorian Housing Register, which also requires that 75 per cent of targetted social housing vacancies will be from the priority access category of the Victorian Housing Register.

Allocation of tenants to new social housing developed through the fund will be coordinated through the Victorian Housing Register.

Prospective partnerships

The Victorian Government has consulted with the finance sector and registered housing associations to test interest from market participants, and has sought input on key design parameters for these initiatives prior to their implementation in 2018.