A major housing and development project in central Albany has received new federal funding aimed at supporting affordable housing, student accommodation and broader economic activity in the Great Southern city.

The $22.5 million Spencer Street Advance Housing Project is receiving $8.1 million through the latest round of the Australian Government's Regional Precincts and Partnerships Program. The project is designed as a mixed-use precinct that will combine housing with tertiary education and commercial opportunities.

The investment is intended to help address housing pressures in Albany while also supporting the city's future growth. The project forms part of a wider effort to strengthen regional communities by connecting housing with education, employment and local economic activity.

The announcement comes as housing affordability remains an important issue across regional Western Australia. A separate regional housing briefing published today reported that rental affordability continues to place pressure on households across the South West and Great Southern regions.

For Albany, the Spencer Street project represents a significant opportunity to increase housing supply in a central location while creating a precinct that can support students, workers and the wider community.

The funding announcement is particularly significant as Albany continues preparations for its 2026 bicentenary program, which is bringing a range of cultural and community activities to the city throughout the year.