Building on solid ground: navigating the ACNC's new community housing guidance

Introduction

On 14 August 2026, the Australian Charities and Not-for-profits Commission (ACNC) published an updated Commissioner's Interpretation Statement (CIS) on community housing, revising its earlier statement first published in December 2014. The revised CIS recasts the ACNC’s guidance for community housing providers, investors, government partners and advisers.

What is a CIS?

A CIS is an official document published by the ACNC Commissioner describing how the ACNC interprets and applies the relevant law. ACNC officers are expected to act in accordance with a CIS when exercising regulatory functions and making decisions. Although a CIS does not have the force of law, it is binding on the ACNC and provides charities with a reliable basis for understanding the Commissioner’s position and for expecting consistent regulatory treatment.

The housing landscape

Australia faces a structural housing shortage. Demand consistently outpaces supply, vacancy rates remain at persistent lows, and housing affordability has deteriorated across many capital cities and regional centres. The Commonwealth has committed $10 billion through the Housing Australia Future Fund (HAFF), established under the Housing Australia Future Fund Act 2023 (Cth), to finance social and affordable housing. State and territory governments have launched parallel initiatives, and institutional investment in the sector continues to grow.

Community housing providers sit at the centre of this policy framework. Many are registered charities as well as registered community housing providers, and they deliver social and affordable housing across a range of corporate structures, from standalone charities to subsidiaries and special purpose vehicles. The ACNC’s updated CIS on community housing provides guidance on how these organisations can maintain their charitable status while operating within this evolving landscape.

What the updated CIS covers

The updated CIS is organised in six parts addressing:

• key concepts
•  registration requirements
  
• community housing and the charitable purpose of advancing social or public welfare
  
• housing types
• commercial arrangements
• practical examples.

General overview

The CIS addresses the threshold requirements for charity registration under the Charities Act 2013 (Cth), the not-for-profit requirement and the ACNC Governance Standards, with detailed guidance on the charitable purpose of advancing social or public welfare. It covers a broad range of housing types, including social housing, affordable rental housing, home ownership schemes, key worker housing and mixed-tenure developments, setting out the conditions under which each will be considered charitable.

The CIS also addresses commercial activities and arrangements with third parties. Providers should note the Commissioner will assess purpose holistically, drawing on governing documents, business plans, tenant selection criteria, tenancy agreements, funding sources, related party arrangements and financial records. This means the supporting material produced by an organisation matters.

Key changes: key worker housing

The CIS provides specific guidance on key worker housing - a topic the previous CIS did not address.

For the purposes of the CIS, a key worker is someone employed to perform a key civic job or essential service to benefit the public, and who generally must be physically present at a work location to perform their job. Key workers include people employed in the public, charity and not-for-profit sectors, or by another employer engaged in providing equivalent services to benefit the public. The ACNC acknowledges there is no consistent definition of ‘key worker’ and that government housing programs adopt different definitions, so providers will need to apply the guidance having regard to jurisdictional differences.

The ACNC identifies three bases on which key worker housing may be pursued for the charitable purpose of advancing social or public welfare:

• the eligible key workers are experiencing recognised charitable need (poverty, distress or disadvantage)
• providing the housing directly furthers a charitable purpose – for example, housing provided to aged care workers to support the purpose of caring for and supporting the aged, or to disability support workers to support the purpose of caring for and supporting people with disabilities
• the housing is provided from a commercial perspective, being to generate funds to support the organisation’s charitable purposes.

Where key worker housing is justified on the basis it directly furthers a charitable purpose, the CIS requires:

• there to be a shortage of workers, or difficulty recruiting or retaining suitably qualified workers, to provide the relevant services
• that providing housing assists in addressing that shortage by enabling key workers to access suitable accommodation providing a modest standard of living in an area where they may reasonably be expected to live
•  that appropriate controls are in place to ensure the housing is provided only while the occupants remain engaged as key workers.
  

Where key workers are selected solely because of their occupation, without regard to charitable need or these considerations, the CIS indicates the housing is unlikely to be provided in furtherance of a charitable purpose and may confer private benefits that are more than incidental.

In practice, this means providers running key worker schemes should be able to point to evidence of the relevant shortage in each location where they operate, adopt eligibility criteria which test charitable need rather than job title, and build occupancy conditions into tenancy documentation that tie the housing to the occupant’s continued engagement as a key worker.

Where a scheme is open to key workers generally, the CIS indicates the provider will need to consider whether that activity furthers a different charitable purpose or is merely incidental to its social or public welfare purposes.

Key changes: multi-party SPVs

The CIS introduces detailed guidance on multi-party special purpose vehicles (SPVs). The ACNC recognises these structures may facilitate growth in social and affordable housing, but notes they raise distinct issues and risks compared with other investment structures, including other types of SPVs, and that multi-party SPVs are currently the investment structure the ACNC most commonly sees.

Importantly, the ACNC acknowledges taking on risk does not, of itself, prevent an organisation from being charitable. Citing the Queensland Supreme Court’s decision in Catalyst Townsville SPV No 1 Pty Ltd v The Presbyterian Church of Queensland (receivers and managers) appointed [2025] QSC 255, the CIS notes Responsible People are ‘not under a duty to avoid incurring risks, which are an inevitable aspect of buying and selling land, constructing buildings, and providing facilities and services to the aged and infirm’.

The CIS sets out governance and contractual considerations for multi-party SPVs. Boards considering or already participating in an SPV should be in a position to address:

• Private benefits to non-charitable participants must be merely incidental to the charitable purpose.
• Debt financing arrangements should generally be fair, reasonable and consistent with commercial market practice, and arrangements with both debt and equity features should be properly characterised as a loan with a contractual obligation to repay principal, on arm's-length terms or terms more favourable to the SPV.
• A charitable multi-party SPV cannot issue ordinary equity that enables investors to receive private profits in their capacity as members, although alternative financing arrangements that do not confer such rights may be compatible with charitable status.
  
• Financial returns to investors or funding partners should reflect a commercial return and be proportionate to their contribution to the project, with excessive or non-commercial returns risking characterisation as a distribution of profits.
• The charity should have taken reasonable steps to support its Responsible People to comply with core governance duties, including adopting conflict of interest and related party procedures, keeping records of decisions to enter into commercial arrangements, seeking independent advice, undertaking market benchmarking and adequately documenting transaction terms.
• Housing assets should continue to be used for charitable purposes on wind-up, with appropriate provision for what occurs at the end of the funding period. If assets are sold or divested prior to winding up and the proceeds are distributed to members or returned to investors, the SPV must demonstrate that such arrangements further its charitable purpose and are consistent with its not-for-profit nature. Any distribution to members must not be made in their capacity as members, unless those members are themselves charities and the distribution is made to further charitable purposes.

The CIS also flags matters worth addressing at the outset rather than at the end of a project, including whether housing assets may be converted to another use during the life of the arrangement, and what happens to assets and sale proceeds when the funding arrangement ends. Providers negotiating SPV documentation now should ensure these questions are dealt with in the transaction documents.

Practical examples

The CIS includes seven practical examples illustrating how the Commissioner will apply these principles across scenarios including regional housing providers, home ownership schemes, affordable housing, commercial arrangements and key worker developments, including examples of arrangements that would not qualify. Providers will find it useful to identify the example that most closely resembles their own model and work through the features the Commissioner treats as decisive. In the two examples that fail, the determining factors were the absence of needs-based tenant selection and the absence of evidence that housing would address an identified worker shortage.

What has changed since the previous version of the CIS?

The previous CIS, first published on 1 December 2014 and last revised with effect from 5 November 2021, was titled 'Provision of housing by charities' and focused primarily on relief of poverty, home ownership, commercial activities and relationships with government. The updated CIS is broader in scope, addressing the full range of ‘advancing social or public welfare’ purposes and introducing new sections on social housing, affordable rental housing, key worker housing, mixed-tenure developments and multi-party SPVs.

The treatment of private benefit, the not-for-profit requirement and the ACNC Governance Standards has been expanded, with detailed guidance on how these concepts apply in the context of complex commercial arrangements and multi-party structures.

These changes reflect recent developments in the sector, including the growth of institutional investment in community housing, the increasing use of SPV structures and the emergence of key worker housing programs, all of which have given rise to regulatory questions not addressed in the earlier guidance.

Some of these changes emerged through consultation. The ACNC released a draft for public comment in late 2025 and, while the final CIS retains much of the draft’s substance, two refinements stand out. First, the title was settled as ‘Community housing’ rather than ‘Provision of housing by charities’, signalling a tighter focus on the sector. Second, the treatment of multi-party SPVs was significantly expanded from a handful of paragraphs to a dedicated section covering registration, governance, financing structures and wind-up, picking up the Catalyst Townsville decision handed down after the draft was published.

What this means for the sector

The updated CIS has several practical implications for community housing stakeholders. In broad terms, providers should use the guidance as a prompt to revisit tenant selection criteria, pricing methodology, governance documentation and the evidence base supporting each housing model they operate:

• The expanded scope of the CIS provides community housing providers with a single, consolidated reference point for understanding the ACNC's position across social housing, affordable rental housing, key worker housing, home ownership schemes, mixed-tenure developments and multi-party SPVs. Providers operating more than one model should check each against the relevant part of the guidance, as the conditions differ between them.
• Providers offering key worker housing will need to demonstrate that the housing addresses a recognised charitable need, directly furthers a charitable purpose, or generates funds for charitable activities. Housing key workers based on occupation alone, without one of these justifications, is unlikely to satisfy the ACNC’s requirements. Providers should identify which basis each scheme relies on and confirm the supporting evidence is documented.
• The detailed treatment of multi-party SPVs indicates the ACNC will closely examine these arrangements. Charities involved in, or considering, SPV structures should review their governance frameworks, contractual terms and conflict management procedures against the updated guidance.
• The practical examples included in the CIS offer providers a clearer picture of the types of arrangements the ACNC considers acceptable, and those it does not, and are a useful reference point when preparing a registration application or responding to an ACNC query.
  
• Providers of affordable rental housing should review their pricing and selection criteria. The CIS states that where affordable rental housing is provided to relieve poverty, the rent must be set sufficiently below market rent to relieve that poverty, and whether a particular discount is sufficient will depend on the circumstances. Discounted housing provided without transparent, needs-based selection is unlikely to be charitable.
• Record-keeping deserves attention, with financial and operational records to be kept for at least seven years. Providers should retain records of their selection criteria, ongoing eligibility criteria and the decisions made under them, and produce those records to the ACNC on request.

Consistent with the ACNC Regulatory Approach Statement, the Commissioner has indicated where the law or the CIS changes, the revised position will generally be applied prospectively rather than retrospectively, and charities will ordinarily be given a reasonable opportunity to respond. Providers should nonetheless assess their current arrangements against the updated guidance.

How we can help

Our Charities and Social Sector team regularly advises community housing organisations on establishment, governance and regulatory compliance, which includes structuring new entities, refreshing governance frameworks, navigating ACNC registration requirements, CHP registration and compliance, group governance and debt financing. If you would like to discuss how the updated CIS may affect your organisation, or require any other assistance, please get in touch.