June 7th, 2026Victorian Royal Commission mental health housing
The Victorian Government must urgently explain its failure to deliver 2,500 supported housing places promised from the Mental Health Royal Commission, after its own report showed only a fifth had been built five years after the inquiry, and no new housing support services delivered.
The Mental Health and Wellbeing Reform Progress Report 2026 reveals only 505 supported housing homes have been delivered after recommendations were handed down in 2021.
The Royal Commission called for 2,000 supported housing dwellings under the Big Housing Build, plus a further 500 dedicated medium-term places for young people aged 18 to 25 living with mental illness and experiencing homelessness.
The report makes no mention of the remaining 1,495 adult supported housing places and is completely silent on the missing 500 youth places.
The government accepted all recommendations from the Royal Commission into Victoria’s Mental Health System without qualification.
Council to Homeless Persons Chief Executive Deborah Di Natale said the government needed to be transparent on whether this recommendation has been scrapped.
“The government made a critical promise to some of Victoria’s most vulnerable people. These Victorians have already been failed by a broken system. The government cannot fail them again now by breaking their promise.
“Every week Victorians are discharged from acute mental health care back into homelessness because there is nowhere safe for them to go. The homes the Royal Commission recommended were meant to end that and the government’s silence on them is not acceptable.”
Ms Di Natale expressed particular concern about the Mental Health and Wellbeing Reform Progress Report’s failure to make any mention of the promised supported housing for young people.
“Mainstream supported housing models were never designed with young people in mind. Young people with mental illness and unstable housing have complex, intersecting needs that require a dedicated response, and the Royal Commission understood that,” she said.
“These 500 places were a recognition that without something built specifically for young people, they would continue to fall through the gaps.”
Community Housing Industry Association Victoria Chief Executive Sarah Toohey said the sector was not asking for anything beyond what had already been promised.
“We know that with stable housing and the right support, people experiencing mental illness can recover. This was recognised by the Royal Commission and the Government, it’s now time to deliver.
“Without these support packages, hundreds of Victorians living with mental ill health are sadly being let down, and put through a revolving door of homelessness, and hospitalisation”.
Mental Health Victoria Chief Executive Officer Phillipa Thomas said the undelivered supported housing is central to whether the state’s mental health reforms could succeed.
“At the core of almost every access and demand and policy problem is housing – there is no doubt about its criticality, no gap in evidence, and no absence of solutions.
“Support for people to maintain their housing to improve their mental health needs to be specialised, and it needs to be resourced as a priority as both a treatment and care standard and a system performance lever.”
