Labor governments in Canberra and Adelaide have struck an $801.5 million housing deal that will unlock 17,000 new homes in South Australia, with nearly 7,000 reserved for first home buyers — a move Prime Minister Anthony Albanese says is about making the great Australian dream achievable again.

“We’re determined to make it easier for young people and first home buyers to achieve the dream of owning a home,” Mr Albanese said, announcing the agreement with South Australian Premier Peter Malinauskas.

“Thanks to this agreement, thousands more South Australians will be getting the keys to their very own home.”

The deal is a major milestone in the Albanese Government’s 2025 election commitment to help deliver 100,000 homes for first home buyers nationwide, in partnership with state governments and industry.

Under the South Australian agreement alone, 6,877 homes will be built specifically for first-home buyers, while a further 10,000 homes will be unlocked for other buyers, significantly boosting overall housing supply.

Premier Peter Malinauskas said the agreement would take the state’s housing push “to a new level”, building on what he described as record construction activity already underway.

“Our Government is throwing everything at building more homes for South Australians,” he said.

“There are already more homes under construction in the state than at any point in history — and now, thanks to our agreement with the Albanese Government, this work is about to reach a new level.”

At the centre of the package is $667.9 million in Commonwealth support to unblock key infrastructure and development bottlenecks.

This includes a $300 million concessional loan to expand water infrastructure in Adelaide’s northern suburbs, directly unlocking around 4,000 homes, and a $50 million three-year concessional loan to deliver a first-home-buyer-only precinct of 400 homes within the Playford Alive urban renewal project.

A further $184 million concessional loan will support the delivery of more than 1,700 homes across multiple urban renewal sites in metropolitan Adelaide, while $133.6 million in matched grant funding from the Commonwealth and the state will deliver 750 additional dwellings for first-home buyers through other programs.

Construction will be fast-tracked, with the first homes expected to begin construction in 2026–27 and first home buyers moving in from 2027–28.

Federal Housing Minister Clare O’Neil said the agreement put first home buyers “at the heart” of Labor’s housing agenda. “We said we’d make it easier for first home buyers to get into home ownership and that’s exactly what this deal does,” she said.

“When we build more homes, first home buyers benefit.”

Ms O’Neil said the South Australian deal was built on Labor’s broader $45 billion national housing plan, which includes planning and environmental approval reforms, incentives to train more tradies through Free TAFE and apprenticeship payments, the delivery of 55,000 social and affordable homes, and schemes such as the 5 per cent Deposit Scheme and the new Help to Buy shared-equity program.

South Australia’s Minister for Housing and Urban Development, Nick Champion, said the state’s policy momentum had positioned it to be the first to strike a deal under the Albanese Government’s 100,000-homes commitment.

“Numerous industry groups celebrate the Malinauskas Labor Government as a national leader in housing policy,” he said.

“That momentum, combined with the Albanese Government’s investment, will mean even more homes for South Australian first home buyers.”

While Labor used the announcement to draw a contrast with the Coalition — which opposed several of the government’s housing supply measures — Mr Albanese acknowledged the scale of the challenge ahead. “We know the housing market is tough,” he said.

“But we want Australians to know that Labor has got your back.”

Both governments conceded more work remains to address what they describe as a housing crisis “generations in the making”, but said the South Australian deal marked a significant step forward for first home buyers and the state’s housing supply.

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