New home building approvals have fallen for the third consecutive month, with ABS data for May revealing a 1.1% decline - as the National Housing Accord marks its second anniversary today with a 91,000-home shortfall and no sign of targets being met.
This was driven by higher density approvals which dropped by 7.3 per cent during the month. However, detached house building approvals were up by 3%.
“It is exactly two years to the day since the start of the National Housing Accord," said Master Builders Australia chief economist Shane Garrett.
"Unfortunately, the Accord’s second birthday sees more evidence that we’re moving even further away from our homebuilding targets
“Annualised data shows a 91,000-homebuilding shortfall has marked the Accord’s first two years," Garrett said.
"The volume of approvals for new homes has been consistently below its long-term trend over the past two years.
“New home building activity across Australia was at its strongest during the mid 2010s. Then, we had a favourable mix of settings involving low interest rates, solid productivity, economic stability and an openness to foreign investment.”
Master Builders Australia CEO Denita Wawn says governments must work to restore those favourable conditions while tackling long-standing constraints that continue to limit supply.
“Incremental change will not deliver the National Housing Accord’s target of 1.2 million new homes," Wawn said.
"We need bold, coordinated reform to unlock supply at scale
“As the Accord marks its second anniversary, it is becoming clearer that the current policy settings are not doing enough.
"The Government must focus on pro-supply reforms, including addressing workforce shortages, reducing unnecessary red tape, delivering more enabling infrastructure and creating incentives to invest in the sector.
“Without meaningful action on these structural barriers, Australia will continue to fall short of its housing ambitions.”
