HIA Managing Director Jocelyn Martin said the report recognises that Australia's housing challenges can no longer be viewed solely through a housing policy lens.

"The committee has recognised a reality that has become impossible to ignore: you can't fix housing affordability without fixing productivity, and you can't fix productivity without fixing regulation," Ms Martin said.

"Housing affordability and supply are fundamentally productivity challenges and must be viewed through that prism."

Ms Martin said HIA was encouraged by the report's conclusion that housing affordability is a structural determinant of productivity performance.

"Housing is no longer simply a single policy issue. It increasingly shapes labour mobility, workforce participation, business investment and national competitiveness."

She said Australia's housing shortage had become a significant economic constraint.

"Australia's housing shortage is now a persistent macroeconomic constraint rather than a cyclical sectoral issue," said Ms Martin.

The report's recommendations on housing finance, macroprudential regulation, National Construction Code reform, pattern books, planning and environmental approvals, infrastructure delivery, EPBC approvals and WHS accreditation recognise the need to address regulatory barriers that are constraining housing supply and economic growth.

Ms Martin said the Productivity Commission had already highlighted the scale of the challenge.

"The Productivity Commission has found that the number of homes completed per hour worked has fallen by 53 per cent. That should concern every government in Australia because we are delivering fewer homes relative to the resources being committed."

"The question is not whether the industry is less capable, but where effort is being directed.

“An increasing share of industry resources was being absorbed by regulatory compliance rather than housing delivery.

"Resources are increasingly consumed by approvals processes, changing codes, specialist reports and navigating multiple layers of government requirements.

"Too much effort is being directed towards administering process rather than delivering outcomes."

"Every additional approval, assessment and compliance requirement adds cost, delay and uncertainty to new housing."

HIA welcomed the committee's recognition that housing projects are affected by multiple regulatory systems that are rarely designed or administered as a single framework.

"Housing delivery is not determined by any one approval. It depends on how effectively planning systems, environmental approvals, infrastructure provision, finance settings and building regulations work together.

"The cumulative effect of these systems is increasing housing costs and reducing the industry's capacity to meet demand."

Ms Martin said the committee's support for pattern books, National Construction Code reform, improved access to EPBC approvals and stronger coordination across approval systems reflected the practical reforms needed to improve productivity while maintaining standards.

"Improving productivity does not mean lowering standards.

"It means ensuring regulation is proportionate, coordinated, evidence-based and focused on delivering genuine public value.

Ms Martin said the committee's findings reinforced a conclusion long identified by industry.

"If we want more affordable homes, we need a more productive housing system.

"That means reducing duplication, improving coordination and removing unnecessary regulatory barriers.

"The Senate Committee has recognised that housing and productivity are inseparable. The challenge now is turning that recognition into meaningful reform," concluded Ms Martin.

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