New home building approvals on the up

The latest bounce in new home building approvals is welcome news for the construction industry, but Master Builders Australia warns there is still a long road ahead to meet housing targets. 

New Australian Bureau of Statistics data shows total home building approvals in September rose by 12 per cent, marking the strongest monthly result since June. 

Master Builders Australia Chief Economist Shane Garrett said the lift was driven by gains across both detached houses and higher-density homes. 

“Detached house approvals increased by 4.4 per cent, the best monthly result in a year, while higher-density approvals surged 23.7 per cent, their strongest since June,” Mr Garrett said. 

“Over the year to September, 191,695 new homes were approved across Australia, the highest annual total in almost three years and 13.7 per cent higher than the previous 12 months. 

“However, this still leaves us around 48,000 homes short each year of what’s required under the National Housing Accord. That shortfall must be closed urgently if we’re to reach the government’s target.” 

Mr Garrett noted that approvals for major home renovations also ticked up by 1.2 per cent, while non-residential building approvals fell 19.3 per cent during the month. 

Master Builders Australia CEO Denita Wawn said the uptick in approvals was positive but underscored the challenge of sustaining momentum amid rising costs and regulatory hurdles. 

“This is welcome news for builders and tradies on the ground, but we can’t ignore the broader context,” Ms Wawn said. 

“Last week’s inflation and producer price data showed building costs and rents are still rising. The ongoing imbalance between housing supply and demand is keeping pressure on affordability for renters and home buyers alike. 

“Boosting housing supply remains the only lasting solution. Governments must fast-track reforms that cut red tape, improve planning and approvals, lift productivity, boost the construction workforce, and get the economy moving again.”  

Media contact: Dee Zegarac, National Director, External Affairs and Engagement
0400 493 071 | dee.zegarac@masterbuilders.com.au