The government will pour $11.3 billion into housing initiatives in Tuesday's budget, with support from premiers and chief ministers.
About $1 billion will be directed towards crisis and transitional accommodation for young people as well as women and children escaping domestic violence.
Grants provided under the National Housing Infrastructure Facility to build these homes will increase from $175 million to $700 million.
The funds will help people most at risk, Homelessness Australia chief executive Kate Colvin said.
"New resources to deliver crisis and transitional accommodation for women and children fleeing domestic violence and young people at risk of homelessness will make a life-changing difference to each family and young person who will now have a safe home," she said.
Future funding needs to address the "rental gap" between the amount of support available and the cost of housing, after research showing 44 per cent of young people are still homeless after receiving support, Community Housing Industry Association chief executive Wendy Hayhurst said.
Housing providers offering tenancies to young people face a financial disadvantage due to lower potential income.
"Community housing providers want to be part of the solution and work with the government to offer safe homes and brighter future," Ms Hayhurst said.
The government will also spend $1 billion building roads, sewers, energy, water and community infrastructure needed for more homes.
Federal funding for homelessness services and social housing will double to $400 million per year and will be matched by the state and territories, with National Cabinet also agreeing to a $9.3 billion, five-year National Agreement on Social House and Homelessness.
Prime Minister Anthony Albanese said the injection of funds would help kick-start construction on a national scale.
"This isn't about one suburb or one city or one state. It's a challenge facing Australians everywhere and it needs action from every level of government," he said.
Treasurer Jim Chalmers said the substantial boost to housing supply would be a priority feature of Tuesday's budget.
It comes as the federal government commits to working with higher education providers on new rules to increase student accommodation.
This follows an earlier budget announcement of more than $90 million to boost the number of tradies and constructions workers, including the provision of an extra 20,000 fee-free TAFE places.
Education Minister Jason Clare reiterated the importance of the international education sector to the Australian economy.
"We need to ensure its ongoing sustainability and part of that means we need more purpose-built student accommodation," he said.
More than $25 billion has already been slated over the next decade in a bid to build 1.2 million homes by the end of 2030.
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