Housing Accord misses target as building activity softens

Australia’s construction sector ended the 2024–25 financial year on a soft note, with the latest ABS Building Activity data for the June 2025 quarter showing declines in dwelling commencements and completions – reinforcing industry warnings that the National Housing Accord is already falling behind schedule.

Housing Accord shortfall heightens pressure on delivery

The Australian Bureau of Statistics (ABS) reported a 4.4% fall in dwelling commencements to 45,156 in the June quarter, marking a sluggish start for the first year of the federal government’s National Housing Accord (July 2024-June 2025).

Master Builders chief economist Shane Garrett said detached house starts fell 6.4%, their weakest quarter since March 2024, while higher-density commencements declined 1.7%.

“There was a 6.4% decline in detached house starts, which recorded their weakest quarter since March 2024, and higher-density home commencements declined by 1.7%.”

Pipeline remains elevated despite slowdown

Despite the decline in new starts, the construction pipeline remains historically strong, with 223,922 dwellings under construction in the June quarter – including 84,760 new houses. This sustained pipeline suggests ongoing demand and future lending opportunities as projects progress to completion.

Completions and value of work done ease

Completions fell 6.5% in the June quarter, with 40,524 dwellings finished.

Private new house completions dipped 2% to 27,287, while other residential completions dropped 17.5% to 12,168.

The total value of building work done declined 0.3% to $38.9 billion, driven by a 0.6% fall in new residential building and a 0.3% dip in renovation activity.

Non-residential construction edged 0.1% higher to $14.8 billion but remained 4.3% below the same quarter last year.

Industry calls for reform to lift supply

Wawn said that while industry capacity remains strong, policy and regulatory hurdles continue to slow delivery.

“We appreciate the work already completed and call on the government to build on this by fast-tracking reforms that cut red tape and boost housing supply,” she said.

“Accelerating approvals, streamlining regulation, addressing skill shortages, and supporting private investment will give industry the certainty to get projects moving.”

What brokers need to know

• Pipeline opportunities remain strong with over 223,000 dwellings under construction, supporting ongoing financing and settlement activity.
• House commencements and completions softened, but medium-density development is showing relative resilience.
• Value of work done slipped slightly, suggesting a cautious but steady market rather than a major slowdown.
• The Housing Accord shortfall increases the urgency for productivity and planning reforms that could lift future construction volumes.

For more details, see the ABS Building Activity, Australia, June 2025 release.

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