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{{propApi.successMessage}} {{region}} Change locationInfrastructure remains the barrier to increased housing supply
Infrastructure remains the barrier to increased housing supply
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The HIA-Cotality Residential Land Report provides updated information on sales activity in 52 housing markets across Australia, including the six state capital cities.
“The median price of residential land sold nationally reached a new record high in the December quarter 2025, at $397,840,” added Mr Devitt.
“Perth, Brisbane and Adelaide have been producing new record high prices for a number of years on the back of their leading of the national home building recovery. Sydney, Melbourne and Hobart have just recently produced their own record highs.
“There are also signs in a number of these markets that land shortages are limiting the number of lots being sold and threatening to constrain home building recoveries all over again.
“A lack of shovel-ready land and associated infrastructure has been by far the number one constraint on home building over the last few decades, even with more recent material price shocks and acute labour shortages.
“There are tens of thousands of homes that could commence construction around the country if the essential transport and utilities infrastructure was in place.
“The problem is that local and state governments face financial constraints that often impede the timely delivery of such infrastructure and subsequent housing.
“The recent Australian Government Budget makes progress on a number of these fronts, including $2 billion worth of ‘enabling infrastructure’.
“The reacceleration of lot prices in recent quarters highlights the importance of addressing the constraints to the delivery of more shovel-ready land and infrastructure.
“The Australian government’s commitment is a positive medium-term step in the right direction,” concluded Mr Devitt.
Cotality research director, Tim Lawless, noted higher land prices were coming at a time when established markets were losing steam. “We have seen Sydney and Melbourne home values gradually falling since December last year, while the smaller capitals are clearly losing steam as higher interest rates and affordability pressures bite.”
“While we may see some affordability improvements as established markets navigate softer conditions, an ongoing scarcity of new housing remains an offsetting factor. It’s hard to see a material improvement in the affordability of Australian housing until we see a broad-based and sustained supply response underway.”
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