The Greens will pass the government’s housing fund through the Senate after Labor agreed to spend an extra $1 billion on social housing.

Monday’s deal ends months of a political stand-off over the Housing Australia Future Fund (HAFF), which the Greens had refused to support and decried as an inadequate response to the nationwide shortage of affordable homes.

A government commitment to spend an additional $1 billion on the National Housing Infrastructure Facility sealed the deal; the legislation will come before the Senate this week.

‘Pressure works’

Greens leader Adam Bandt said the deal brought to $3 billion the total extra money the government would spend on housing this year, which validated their blockade of the legislation.

“We’ve just learnt that pressure works,” Bandt said.

“They said there was no more money in the kitty – and then we found $3 billion.

“Would we like to go further? Would the Greens tax big corporations to put more money into public housing? Of course, we would. But $3 billion will make a difference.”

Bandt promised to keep pushing for the federal government to co-ordinate a rent freeze with the states, which the party had previously named as a condition of their support of the HAFF.

Prime Minister Anthony Albanese said the bill would now have majority support in the Upper House.

“I thank the leader of the Greens for the constructive discussions,” Albanese said.

He accused the Coalition of becoming irrelevant on housing policy.

“They sit in the corner and just say no,” the Prime Minister said.

The crack was met with a heckle from the Opposition benches of “Adam’s in charge”.

The $10 billion fund seeks to build an additional 30,000 social and affordable homes by spending $500 million a year on housing from the return on its investments.

In June, against the backdrop of the fight in the Senate, the Prime Minister announced an additional $2 billion for social housing.

Last month, the PM unveiled a program for boosting housing supply through $3 billion worth of incentives for state governments that  exceeded their targets for constructing new homes.

Builders back it

But the PM and state and territory Labor leaders at the national cabinet declined to take up the Greens’ push for a rent freeze, which they said would exacerbate rental shortages by discouraging new housing supply.

Master Builders CEO Denita Wawn welcomed the news.

“The Housing Australia Future Fund legislation is a vital piece in the housing puzzle by encouraging investment in the social and community housing sector,” she said.

Opposition housing spokesman Michael Sukkar said the Coalition would vote against the bill.

“The Coalition will not be supporting the establishment of the HAFF, which is merely $10 billion in additional Commonwealth government borrowing that cannot guarantee and will not deliver a single home before the next election,” Sukkar said.