Australia’s housing pipeline is falling well behind federal targets, deepening the squeeze for borrowers and the brokers who advise them.
According to the National Housing Supply and Affordability Council (NHSAC), since July 2023 Australia has built more than 140,000 fewer homes than needed. Longer-term projections from AMP chief economist Shane Oliver put the overall deficit at between 220,000 and 300,000 homes, depending on household size trends, Yahoo Finance reported.
The Albanese government has pledged to deliver 1.2 million new homes between July 2024 and June 2029. To be roughly on track, around 300,000 homes should have been completed by now; instead, the tally is 219,800 – about 80,200 short and “coming up well short” of what’s required to keep up with population growth.
The national figures hide large state differences. Over the past 12 months, New South Wales was the clear laggard on dwelling completions per 100,000 people, with just 494.5 – the lowest among major states.
Yet viewed globally, even NSW’s weaker performance is notable. In the most recent full calendar year, NSW still built 19.6% more homes per capita than the United States and 1.7% more than Canada. Over the last 40 years, the US has only outbuilt NSW per capita in seven calendar years, despite NSW having the worst long-run average of the major Australian states.
Victoria has been the recent standout, recording 790.3 dwelling completions per 100,000 people over the past 12 months – almost 60% more than NSW. Western Australia followed with 748.7 completions per 100,000, and South Australia with 675.6.
NHSAC expected Victoria to complete 98% of its share of the 1.2 million-home Housing Accord target, while NSW was only tipped to reach about 65% and Tasmania just 51%. Over the past 40 years, WA has averaged 962.0 completions per 100,000 people, with NSW again at the bottom on 632.1.
Even though Australia outperforms many peers on dwellings built per capita, new supply is still not keeping pace with demand. With the 1.2 million homes goal likely to be missed, brokers face markets where:
In this environment, brokers need to help clients understand that housing scarcity – not just rates – is increasingly setting the rules of engagement.
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