Master Builders Australia’s latest industry forecasts show the National Housing Accord is drifting further off track, with the housing shortfall worsening since April.
The report reveals that 180,500 homes were started in 2024-25. This was almost 60,000 short of the Accord’s annual target of 240,000. Across the full five-year term, the expected shortfall has now grown to 180,200 homes compared with the 160,000 gap projected in April.
Chief economist Shane Garrett said the forecasts highlight the scale of demand going unmet.
“Australians are crying out for more housing, but demand is being left unrealised.
“Projects are stalled by rising costs, low productivity and long build times. Without rapid reform, the activity needed to deliver 1.2 million homes will not materialise.
“No state or territory is on track to meet its target. High-density housing must accelerate quickly, but many jurisdictions lack the capacity to deliver at scale. Governments must streamline planning and approvals now to unlock supply.
“The workforce challenge is just as pressing. Construction employment is near record highs, but productivity has fallen 18% over the past decade. Longer build times and higher costs are holding us back. We need more workers across trades and professions to restore capacity and viability,” Mr Garrett concluded.
Master Builders CEO Denita Wawn said builders are ready to deliver but cannot do it alone.
“Australian builders are keen to get on with the job, but under current conditions the Accord’s 1.2 million home goal looks less achievable every day. Without urgent action to fix productivity, approvals, costs and workforce shortages, the target will be missed.
“We will be closely watching new dwelling approvals, especially high-density projects which must rise sharply to get back on track.
“Tackling the housing crisis requires cooperation across governments and across portfolios. We need a whole-of-government approach to remove the barriers in our way,” Ms Wawn concluded.
While housing is the most urgent concern, the forecasts also show encouraging signs in other areas of construction.
Civil and engineering activity reached its busiest year in a decade at nearly $138 billion, driven by utilities and resources projects. Growth has been underpinned by utilities and resources projects, with further expansion expected as major government-backed infrastructure programs roll out.
Civil and engineering work is forecast to peak at more than $154 billion in 2026-27 before easing back, averaging $147.8 billion annually over the forecast horizon. This represents an increase of more than 20% compared with the past five years, confirming the sector’s role as a major driver of economic growth and employment.
Non-residential building softened slightly in 2024-25 but is expected to rebound, with strong growth projected in social, cultural and recreational facilities on the back of public sector investment. Together, these sectors will remain important pillars of demand for the industry and the broader economy.
Master Builders is calling on the Federal Government to accelerate its reform agenda following the economic reform roundtable to address these bottlenecks. Streamlined approvals and investment in workforce capacity are essential if Australia is to close the widening gap on the Accord’s 1.2 million home target.
.png)
.png)
For more industry news, click here.
