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The nation had hoped to be ramping up home building, but the latest ABS data on completions has caused concern in the industry.
The Australian Bureau of Statistics (ABS) has revealed that quarterly housing completions increased over the June quarter, registering a 7.3 per cent increase over the March quarter which saw 44,853 homes built over the period.
Despite this growth, total dwelling commencements declined 1.1 per cent from the March quarter, with new apartment and townhouse commencements notably falling 12.3 per cent over the past 12 months to 13,756 dwellings in the June quarter.
Captured in this data is the final quarter before the 1 July launch of the National Housing Accord target, when home building was expected to be ramping up. Several industry bodies have subsequently raised concerns around the country’s progress towards delivering the goal of 1.2 million new homes by 2029.
Chief economist at Master Builders Australia, Shane Garrett, said: “If building continues at this pace, we’ll be in for less than 800,000 new home starts over the next five years. This would mean a shortfall of over 400,000 homes compared with the National Housing Accord target.”
The industry body detailed that these housing reductions coincide with data from the National Centre for Vocational Educational Research showing a fall back in apprenticeship commencements and training over March 2023 to March 2024.
Speaking on these findings, Master Builders CEO Denita Wawn said that the two data releases “aren’t unrelated” and warned that the findings “paint a concerning picture for Australia’s housing crisis”.
Wawn highlighted that these low apprenticeship numbers indicate a shortage of skilled trade workers, and stressed that until Australia addresses these challenges, “we won’t be able to boost building activity or alleviate the impact of supply conditions in the residential construction market on the country’s inflation issue”.
“We urgently need governments to look at solutions to increase the number of tradies, increase the number of apprentices, and help Australian builders increase supply so we can come out the other side of this housing crisis,” she said.
The Property Council of Australia also expressed concern around the country’s progress towards the Housing Accord target, noting that the country must average 60,000 new homes each quarter over the next five years to build 1.2 million homes by 2029.
Weighing in on this shortfall, the group’s executive, policy and advocacy, Matthew Kandelaars, stressed that “we are still not building enough”.
He further described the recent data on housing commencements as a “particularly worrying sign” which highlights the fragility of Australia’s housing pipeline.
“Although it is encouraging to see an increase in the number of completed homes, today’s figures show how far we have to go if we hope to reach our 1.2 million new homes target,” he said.
“These numbers serve as a reminder of the tough road ahead and that we need to do everything, everywhere, all at once to boost housing supply.”
In order to address these issues, Kandelaars emphasised the need for governments at all levels to “work in partnership to deliver the homes Australians need”.
“This means boosting housing-enabling last-mile infrastructure, speeding up approvals, and addressing apartment-killing state taxes.”
“And it means parties need to put aside political point scoring for the good of the nation and pass legislation before the Parliament that will boost housing supply,” he concluded.
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