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New data from the Australian Bureau of Statistics (ABS) concerning building approvals and lending indicators continues to show we need to do more to tackle supply constraints in the housing pipeline as new home building and lending declines.
Master Builders Australia CEO Denita Wawn said resolving supply constraints should be the focus for all political parties in fixing our housing crisis, and until they are addressed, Australians will continue to struggle with housing affordability.
“According to the ABS figures, the total number of new dwelling approvals experienced a slight decline of 1.0 per cent compared to December.
“Notably, there was a substantial drop of 9.6 per cent in approvals for new detached houses, marking the weakest monthly total since June 2012. However, there was a contrasting increase of 14.5 per cent in approvals for higher density homes.
“Despite the increase in higher density approvals, the volume of new apartments and units remains below historic standards. We need to significantly boost the supply of this housing type to alleviate pressures in the rental market.
“Whether it’s detached housing or higher density the same constraints apply including planning restrictions, lack of capacity to undertake critical infrastructure so land is home-building ready, high taxes and charges, slow approval processes, and workforce shortages.
“The ABS data also indicated a decline in lending volumes related to new home building during January 2024.
“Dwelling construction loans fell by 4.3 per cent in seasonally adjusted terms, with loans for new dwelling purchases down by 3.9 per cent. Notably, housing investors continue to play a significant role in the market, accounting for a considerable share of activity.
“Housing investors remain a significant player in the market, representing 40.3 per cent of new dwelling construction loans during January.
“We must ensure that sufficient support is provided to encourage investment in housing development this includes steering clear of any changes to negative gearing and capital gains tax,” Ms Wawn said.
Media contact: Dee Zegarac, National Director, Media & Public Affairs
0400 493 071 | dee.zegarac@masterbuilders.com.au