Understand affordable rental housing

Information about affordable housing, why it matters and how it differs from social housing.

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What is affordable housing?

Affordable rental housing is housing that is available for rent at a lower price than usual market rent. It’s for households with a lower income, and for households going through change that impacts them financially. By paying a lower amount of rent, households are better placed to afford other living costs.

Affordable housing typically costs less than 30% of your gross income. It’s developed with some assistance from government, including through funding and planning incentives. It includes various property types and sizes including single or multi-bedroom units, houses, and studios.

Eligibility criteria apply, and properties are available at reduced rents compared to the private market. Homes NSW works in partnership with the housing sector to create more affordable homes, giving people across NSW a safe, secure, and affordable place to live. Affordable rental housing may be owned by local or state government, community housing providers, charitable organisations, private developers or investors.

If it has been developed with assistance from the NSW Government and/or through NSW planning legislation, it must be managed by a registered community housing provider and in accordance with the NSW Affordable Housing Ministerial Guidelines (PDF 13.73MB).

Affordable housing eligibility

Eligibility depends on household income and other factors. In NSW, affordable housing is for households on:

Very low income: Less than 50% of the median income (such as minimum wage earners, pensioners or people on government benefits).
Low income: Between 50% and 80% of the median income (such as childcare workers or cleaners).
Moderate income: Between 80% and 120% of the median income (such as teachers, police or nurses starting their careers).

Eligibility, including income limits, can vary depending on the way a property was funded or developed, and who manages it. Income eligibility limits set by the NSW Government are outlined in the NSW Affordable Housing Ministerial Guidelines.

Income eligibility is updated annually.

Know the difference between affordable housing and social housing

Affordable housing

For very low to moderate income earners.
Managed by community housing providers, similar to private rentals.
Rent is discounted or based on income, and regular eligibility reviews are conducted.
Households do not have to be eligible for social housing.
Vacancies advertised on community housing provider websites or real estate websites.

Social housing

Long-term housing for very low-income households with significant needs.
Includes public, community, and Aboriginal housing.
Designed for people who can't meet their needs in the private rental market.
Must apply and be eligible to go on the waiting list.

Affordable housing is broader, with separate rules and tenancy arrangements from social housing.

Find out who needs affordable housing

Affordable housing supports people:

who work full or part-time in low paid jobs (e.g., retail and hospitality workers, nurses, police officers, childcare workers, students, apprentices)
facing life changes like job loss, separation, or moving to a single income.

Some households need affordable housing for a short time before transitioning back to the private rental market or buying a home.

Why housing affordability matters

In NSW, many people on low incomes can’t find affordable housing. Over 480,000 households were in housing stress in 2021, spending more than 30% of their income on rent.

Since then, rents have skyrocketed, and the supply of affordable rentals has dropped. People struggling to afford housing often:

accumulate unmanageable debt
work long hours or travel far to access jobs
go without essentials like food, heating, or medication.

Affordable housing addresses these challenges, offering stability and reducing financial stress.

Learn how affordable housing rents are set

Affordable housing rents are based on:

discount to market rent: Usually 20-25% less than private market rents in the area
proportion of a households income : Often 25-30% of your gross income, depending on the provider.

The rent-setting method depends on how the property was funded and contractual requirements. Managers also use strategies to ensure availability to a range of income groups balanced with costs of managing the properties.