Time to play catch up on housing targets as building activity rebounds

New data released by the Australian Bureau of Statistics today shows building activity is continuing to rebound in the March quarter as the industry moves through a high interest rate and inflation environment, but more effort is needed if we’re going to meet housing targets.

Master Builders Australia CEO Denita Wawn said home building activity picked up strongly in the March 2025 quarter, with total dwelling commencements rising by 11.7 per cent compared to the previous quarter, and up 17.3 per cent on a year earlier.

“At 47,645 new dwellings, it’s the strongest quarter since June 2022.

“This rebound was led by a sharp lift in higher density home building. Higher density starts rose by 20.9 per cent over the quarter and were 29.1 per cent higher than a year ago.

“The 19,142 starts is the highest quarterly figure for this segment since December 2021. Detached housing also saw growth, albeit modestly.

“Despite this uplift, we are still tracking behind what’s required to meet the National Housing Accord targets.

“Since the commencement of the Housing Accord, just 134,466 new dwellings have commenced. To stay on track, we would need around 60,000 starts per quarter – we are about 25 per cent short of that pace.

“Home renovations remained stable, rising 1.1 per cent for the quarter and 5.5 per cent compared to a year ago – broadly in line with recent trends.

“Work on non-residential buildings dipped slightly, falling 0.6 per cent in the quarter and 4.1 per cent over the year. This is a marginally smaller fall than in the previous quarter (-2.9 per cent).

“While there is room for optimism that the worst is now behind us, the government and industry need to play catch-up if we’re going to meet the 1.2 million new homes target under the National Housing Accord,” Ms Wawn said.

Master Builders is advocating for policies that address the productivity challenges in the industry, which are unnecessarily driving up project costs and build times.

“Productivity in the building and construction industry has fallen 18 per cent over the last decade, even as housing costs have surged by over 40 per cent.

“Boosting productivity is essential to building a better, safer and fairer industry. It helps deliver quality outcomes, improves safety standards and keeps costs down.

“The building and construction industry is crucial to driving economic growth, making up over 11 per cent of Australia’s GDP.

“The upcoming Federal Government productivity roundtable provides an opportunity for major stakeholders to fix the biggest pinch points that are holding construction back and prolonging the housing crisis,” Ms Wawn concluded.

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