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{{propApi.successMessage}} {{region}} Change locationHome buyers rush to beat building code changes
Home buyers rush to beat building code changes
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The HIA New Home Sales report is a monthly survey of the largest volume home builders in the five largest states and is a leading indicator of future detached home construction.
“Changes to the National Construction Code (NCC) came into effect in Victoria and Queensland on the first of May. This is expected to add thousands of dollars to the cost of construction through, among other things, the Code’s new energy efficiency standards,” added Mr Reardon.
“To get ahead of these cost increases, home buyers rushed to sign the contract for the construction of their new home by the end of April.
“New South Wales experienced the same phenomenon last September when the state introduced its latest energy efficiency standards, adding significantly to the cost of a new home. This was followed by an equally large drop in sales in the subsequent months.
“As with New South Wales, a ‘shadow’ of demand for new homes is expected in Victoria and Queensland in May and June, reflecting the sales that were drawn forward into April.
“Additional regulatory costs, such as the NCC changes, are one of the causes of the acute shortage of housing. The changes are intended to achieve energy efficiency and accessibility outcomes, but they also force people out of homeownership and the rental market.
“The NCC changes are also inequitable as they impose a much higher cost of national carbon abatement goals onto those building a home than any other segment of the economy. These measures are inconsistent with a least cost, economy wide, approach to carbon abatement.
“Ongoing changes to building codes will continue inflating the costs of construction with the next phase of building regulations now open for public consultation.
“If ever there were a good time to stop inflating the cost of home building, this must be it.
“Lowering the cost of delivering new homes to market is essential to achieving the Australian government’s target of 1.2 million new homes over the next five years, and improving housing affordability across the country,” concluded Mr Reardon.
For the month of April, all the large states saw increases in new home sales compared to March 2024, led by Victoria (+34.9 per cent), and followed by New South Wales (+33.1 per cent), Queensland (+25.5 per cent), South Australia (+17.0 per cent), and Western Australia (+1.1 per cent).
Over the three months to April 2024, all of the large states are up compared to the same quarter last year, led by Queensland (+57.1 per cent), and followed by South Australia (+20.8 per cent), Victoria (+19.5 per cent), New South Wales (+15.8 per cent), and Western Australia (+12.5 per cent).
Private New House Sales - Australia (seasonally adjusted)
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