Government's housingaccord falling well short of targets.
Against needing 60,000 completions per quarter to reach 1.2m homes over 5 years, the September 2024 quarter recorded just 44,884 completions per the Australian Bureau of Statistics.
No surprise here to those who understand the economics of housing development. We've warned about this for a long time.
Concerningly, none of the key measures are pointing to a major improvement soon: • new approvals remain near decade lows • new commencements lagging, especially in density • construction costs still rising – faster than CPI • regulation & taxes increasing, not decreasing!
In fact, we'll be lucky to see even 900,000 homes built across this period – a >300,000 shortfall.
Australian Property Investor Magazine asked me for my thoughts:
“Every element of new housing development is much more expensive than it was just a few years ago – land, materials, labour, finance, taxes, development charges and design regulation.
“As long as governments acts as though you can legislate and over-tax your way to housing supply, Australia will continue to fall well short of its housing targets, with apartment development most acutely impacted.
“If we are serious about tackling the challenge in the short-term, we need a reallocation of planning efforts and investment to unlock more, less costly, faster to deliver and more-feasible projects – greenfield land and mid-density townhouses – massively reducing the burden of red tape …”
🤔Prettty good advice, I think – if only Government would listen to those who do this for a living instead of how they think things should work!