Australia’s dwelling units approved increasing 5.5 percent in May from the prior month, based on the Australian Bureau of Statistics (ABS) data, but it remains significantly lower than the federal government’s target.
According to ABS, approved total dwelling units rose in the majority of the states with Western Australia leading the growth at 19.6 percent, followed by Victoria at 8.9 percent, and Queensland at 6.3 percent. Moreover, South Australia grew 4.1 percent while Tasmania climbed 3.8 percent.
However, the Northern Territory and Australian Capital Territory remained flat during the period.
On a year-on-year basis, Australia’s total dwelling units approved decreased 8.5 percent. Private sector houses slid 12 percent while private sector dwellings excluding houses plunged 31.7 percent.
“There have been 163,760 total dwelling approvals over the most recent 12 months to May 2024,” said Tim Reardon, Housing Industry Association (HIA) Chief Economist.
“This is well below the 240,000 new homes needed each year from 1 July 2024 to achieve national cabinet’s goal. The low approvals numbers indicate a slow start to building 1.2 million homes over the next five years.”
Mr. Reardon added that it is crucial to address tax, planning, land, and regulatory constraints to boost the supply of homes in Australia.
Similarly, Masters Builders Australia CEO Denita Wawn said that the country is not “race ready” in its attempt to build 1.2 million homes within five years.
“While there’s been some progress at a state and federal level, particularly in the housing portfolios, it has simply not been fast enough or is being undermined by other policies. Simply put, investment in new home building does not stack up without further reform,” said Ms. Wawn.
“Industrial relations laws, worker shortages, slow planning approvals, a lack of critical infrastructure, high developer taxes and charges, and licensing delays all add to the cost and time it takes to build.”
The Albanese government previously committed $32 billion in new housing initiatives through its Homes for Australia plan, to deliver more houses nationwide starting July 1.
This includes $10 billion Housing Australia Future Fund to build 30,000 social and affordable rental homes; $2 billion Social Housing Accelerator to deliver around 4,000 new social homes; and $3 billion New Homes Bonus to incentivise states and territories to build more homes.
The plan also allocated $5.5 billion Help to Buy scheme to help more Australians buy their own home; $2.7 billion to increase Commonwealth Rent Assistance by 15 percent; and $2 billion in financing for more social and affordable rental homes.
The government also dedicated $90.6 million to increase the number of construction workers, including 20,000 new fee free training places.
