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{{propApi.successMessage}} {{region}} Change locationAustralia is not commencing enough housing to meet 1.2 million target
Australia is not commencing enough housing to meet 1.2 million target
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The ABS today released its building activity data for the September Quarter 2023. This data provides estimates of the value of building work and number of dwellings commenced, completed and under construction across Australia and its states and territories.
“This data reveals there were 103,707 detached houses that commenced construction in the twelve months to September 2023, down by 17.0 per cent on the 124,940 commenced in the previous twelve-month period,” added Mr Devitt.
“This points to a slow start to National Cabinet’s ambition to build 1.2 million homes over the next five years starting mid-2024.
“Since the RBA’s first cash rate increase in May 2022, sales of new homes have tumbled. A number of earlier projects are also being cancelled, with banks withdrawing finance in the face of soaring building costs and shrinking homebuyer borrowing power.
“This lack of new work entering the construction pipeline is expected to produce a trough in new house commencements in 2024, when Australia will start construction on just 95,400 new houses, the weakest year in over a decade.
“There was also a decline in the number of multi-unit projects commencing construction, down by 9.6 per cent in the September Quarter 2023 to just 13,916, one of the weakest quarters in over a decade.
“Multi-unit commencements are mounting a recovery on the back of population growth and land constraints, with Australia expected to commence 84,400 new multi-units in 2024.
“This would still put total detached and multi-unit commencements at less than 180,000 in 2024, far below the 240,000 per annum required to meet National Cabinet’s target.
“As fewer new projects begin construction, the pipeline of work that Australia’s home builders have under construction is expected to shrink rapidly this year.
“Meeting National Cabinet’s target will be largely dependent on the delivery of adequate private housing across the housing continuum. This will also have the biggest impact on the cost of housing and rental availability.
“Holding all levels of government to account for improving planning regimes, reducing red tape, and supporting the development of appropriate infrastructure and a skilled construction workforce, must be a priority this year,” concluded Mr Devitt.
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Support for tradies to take on apprentice critical to delivering more homes for Australia
“Tonight’s Budget-reply by the Coalition included a key measure to provide $12,000 of financial support for small businesses and tradies to take on an apprentice and support them through their trade” stated HIA Managing Director, Jocelyn Martin.
Own goal housing policy
Treasurer Jim Chalmers, in his Budget speech stated: “And we’re easing pressure on the housing market by banning foreign investors from buying established homes and cracking down on foreign land banking as well.
Budget a missed opportunity to deliver a concrete housing plan
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If you can’t map the land, you can’t deliver the homes
“Inadequate planning for growth in the demand for land and housing has contributed substantially to the excessive cost and significant undersupply of new homes being felt across all states and territories,” said Mike Hermon, HIA Executive Director Planning & Environment.