March’s building approvals reflect need to get Federal Budget right

4 May 2026

New home building approvals dropped by 10.5 per cent in March according to ABS figures out this morning, highlighting leaks in Australia’s construction pipeline.

Master Builders Australia Chief Economist Shane Garrett noted a particularly large drop in higher density building approvals which declined by 23.4 per cent during March.

“With tomorrow’s interest rate decision looming, any further interest rate increases will make it tougher to bring new homes into existence. We’re really depending on higher density homes to help us reach the Housing Accord target. It’s worrying that activity in that part of the market shrank sharply during March.

“Builders are also reporting that impacts from the Middle Eastern conflict are making it considerably more expensive for them to undertake work. There is a danger that cost increases combined with higher interest rates could lead to market deterrence,” Mr Garrett said.

Master Builders Australia CEO Denita Wawn reiterated today that the barriers to increasing housing supply must be urgently removed.

“Master Builders’ latest forecasts, and those released by the National Housing Supply and Affordability Council last week, predict a housing shortfall of more than 200,000 homes by the end of the National Housing Accord in 2029. Today’s figures show that a 77,600-home backlog has already accumulated.

“This new data shows Australia still needs a rapid dismantling of supply barriers and an increase in building approvals that will stimulate the civil, residential and non‑residential pipelines and fight back against housing inflation.

“Governments must focus on policies that encourage investment, cut unnecessary red tape, grow the construction workforce and deliver enabling infrastructure, as outlined in our federal budget roadmap,” said Ms Wawn.

Master Builders Australia’s federal budget roadmap calls on the Federal Government to prioritise:

• Investment incentives: offering accelerated depreciation for capital works and increases to the Instant Asset Write Off
• Regulation reduction: streamlining the National Construction Code and committing to a reduction in unnecessary red tape across the board by at least 25 per cent as called for by the Alliance of Industry Associations
• Workforce increases: investing in all apprentice training pathways and embracing skilled migration
• Infrastructure investment: increasing private and public investment in housing enabling infrastructure.

Media contact: Dylan Hafey, Media Advisor

0497 330 064 | dylan.hafey@masterbuilders.com.au