New data from the Australian Bureau of Statistics shows with three months to go until the Housing Accord clock starts ticking, higher density approvals have hit their lowest monthly figure in almost 12 years.
“Total new home building approvals slipped by 1.9 per cent during February,” said Master Builders Australia Chief Economist Shane Garrett.
“There was considerable variation within the figures: detached house approvals recorded a decent gain of 10.5 per cent during the month. However, this was undone by higher density approvals plummeting by 20.8 per cent.
“Over the year to February, just 163,100 new homes received approval across Australia – the lowest in 11 years.
“This stands in stark contrast to the annual target of 240,000 new homes under the ³Ô¹ÏÍøÕ¾ Housing Accord.
“For us to achieve this calibre of housing output, approvals would need to increase by 48 per cent on current levels,” Mr Garrett said.
CEO Denita Wawn added: “Despite the community’s high demand for more housing, especially higher density rentals, there is a mismatch in the number of homes coming through the pipeline.
“When it comes to signing new contracts, the pen is not making it to paper as the investment does not stack up.
“Resolving supply constraints should be the focus of all political parties in fixing our housing crisis. Until they are addressed, Australians will continue to struggle with housing affordability.
“We must ensure that sufficient support is provided to encourage investment in housing development this includes steering clear of changes that would dampen the investment environment.
“Currently, the biggest handbrake on delivery of homes is the high costs associated with labour shortages.
“We heard only recently from BuildSkills Australia that the industry needs 90,000 workers in the next 90 days. Master Builders also estimates this needs to grow to around half a million over the next three years.
“The Federal Budget provides an opportunity to attract more people into the industry through industry-led apprenticeships, better targeted skilled migration and reskilling migrants already in the country.
“But it’s not the only challenge. More work needs to continue at a state/territory government level to speed up their commitments for planning reform, address high developer charges, and ensure there is enough critical infrastructure to support new communities or higher density,” Ms Wawn said.
