Higher-density approvals have reached their lowest monthly total in over 12 years, according to new statistics from the Australian Bureau of Statistics. With the clock ticking on the impending Housing Accord, this decline signals a potential challenge in meeting the nation’s housing needs.
Figures at a Glance
Chief Economist of Master Builders Australia, Shane Garrett, highlighted a 1.9 per cent slip in total new home building approvals in February. Detached house approvals saw a commendable rise of 10.5 per cent, but this was overshadowed by a staggering 20.8 per cent plummet in higher density approvals. Over the preceding year, only 163,100 new homes gained approval nationwide, the lowest in 11 years.
Meeting Housing Demands
Denita Wawn, CEO of Master Builders Australia, emphasised the disparity between demand and supply in the housing market. Despite a high demand for more housing, particularly in higher-density rentals, there’s a palpable shortage in the pipeline.
Labour Shortages and Challenges Ahead
Labour shortages emerge as a significant hurdle, with BuildSkills Australia estimating a requirement of 90,000 workers in the next 90 days. This figure is projected to escalate to half a million over the next three years, underscoring the urgency for industry-led apprenticeships and targeted skilled migration.
Addressing the Crisis
The Federal Budget presents an opportunity to attract more individuals to the industry through strategic initiatives, including industry-led apprenticeships and skilled migration pathways. However, addressing housing affordability extends beyond labour shortages, requiring collaborative efforts at state and territory government levels to expedite planning reforms, mitigate developer charges, and bolster critical infrastructure.
In the face of dwindling approvals and escalating challenges, resolving supply constraints emerges as an imperative to alleviate the housing crisis and ensure a sustainable future for Australia’s housing market.
