Latest news with #NationalHousingSupplyandAffordabilityCouncil
The Advertiser
15-07-2025
- Business
- The Advertiser
Rising cost to build a wake-up call on housing dream
A rise in construction costs is likely to stoke inflation while pushing home-building targets further out of reach, fresh data analysis suggests. Construction costs rose 0.5 per cent in the June quarter, picking up slightly from a 0.4 per cent rise in the March quarter, according to property analyst Cotality's latest Cordell Construction Cost Index. The re-acceleration is likely to weigh on inflation outcomes because the cost of new dwellings comprises the largest weight in the consumer price index, Cotality research director Tim Lawless said. While noting the increase was half the pre-pandemic decade average of one per cent, Mr Lawless said builders struggle with feasibility assessments amid high material and labour costs. "With the cost of building a new home continuing to rise, the (government's) stretch target of building 1.2 million new homes by July 2029 is looking harder and harder," he said. Property Council of Australia policy and advocacy executive Matthew Kandelaars said the uptick in construction costs "chips away at the feasibility of new housing projects" when the nation needs to be accelerating towards the target of 1.2 million new homes. Better investment and tax settings are needed, Mr Kandelaars said, along with smarter and more efficient approvals and more skilled workers to build the homes. "Without this balance, we'll remain stuck in a doom-loop of low margins, constrained project feasibility, cost blowouts and delivery delays." Independent government advice body the National Housing Supply and Affordability Council warned the federal government in a May report that it would fall short of its 2029 goal by about 300,000 dwellings. Western Australia recorded the largest quarterly increase in construction costs in the three months to June at 0.7 per cent, followed by Victoria (0.6 per cent), NSW and South Australia (0.5 per cent) and Queensland (0.4 per cent). Cotality said the latest data reinforces commentary from the Reserve Bank in its July 8 decision to maintain the cash rate at 3.85 per cent, which highlighted as a concern the re-acceleration of growth in the cost of new dwellings via the monthly CPI indicator. In her rates commentary, the central bank's governor Michele Bullock noted certain components of monthly inflation - particularly home-building costs - had been "slightly stronger than expected", which contributed to the decision to hold rates. The RBA added that high construction expenses continue to exert upward pressure on inflation, reinforcing its cautious stance. Competition for skilled trades also remains intense amid a record level of public infrastructure spending, with Infrastructure Australia forecasting a mismatch between the demand and supply of labour until mid-2028. This means continued inflation pressure is likely from building costs centred on the labour market, Mr Lawless said. A rise in construction costs is likely to stoke inflation while pushing home-building targets further out of reach, fresh data analysis suggests. Construction costs rose 0.5 per cent in the June quarter, picking up slightly from a 0.4 per cent rise in the March quarter, according to property analyst Cotality's latest Cordell Construction Cost Index. The re-acceleration is likely to weigh on inflation outcomes because the cost of new dwellings comprises the largest weight in the consumer price index, Cotality research director Tim Lawless said. While noting the increase was half the pre-pandemic decade average of one per cent, Mr Lawless said builders struggle with feasibility assessments amid high material and labour costs. "With the cost of building a new home continuing to rise, the (government's) stretch target of building 1.2 million new homes by July 2029 is looking harder and harder," he said. Property Council of Australia policy and advocacy executive Matthew Kandelaars said the uptick in construction costs "chips away at the feasibility of new housing projects" when the nation needs to be accelerating towards the target of 1.2 million new homes. Better investment and tax settings are needed, Mr Kandelaars said, along with smarter and more efficient approvals and more skilled workers to build the homes. "Without this balance, we'll remain stuck in a doom-loop of low margins, constrained project feasibility, cost blowouts and delivery delays." Independent government advice body the National Housing Supply and Affordability Council warned the federal government in a May report that it would fall short of its 2029 goal by about 300,000 dwellings. Western Australia recorded the largest quarterly increase in construction costs in the three months to June at 0.7 per cent, followed by Victoria (0.6 per cent), NSW and South Australia (0.5 per cent) and Queensland (0.4 per cent). Cotality said the latest data reinforces commentary from the Reserve Bank in its July 8 decision to maintain the cash rate at 3.85 per cent, which highlighted as a concern the re-acceleration of growth in the cost of new dwellings via the monthly CPI indicator. In her rates commentary, the central bank's governor Michele Bullock noted certain components of monthly inflation - particularly home-building costs - had been "slightly stronger than expected", which contributed to the decision to hold rates. The RBA added that high construction expenses continue to exert upward pressure on inflation, reinforcing its cautious stance. Competition for skilled trades also remains intense amid a record level of public infrastructure spending, with Infrastructure Australia forecasting a mismatch between the demand and supply of labour until mid-2028. This means continued inflation pressure is likely from building costs centred on the labour market, Mr Lawless said. A rise in construction costs is likely to stoke inflation while pushing home-building targets further out of reach, fresh data analysis suggests. Construction costs rose 0.5 per cent in the June quarter, picking up slightly from a 0.4 per cent rise in the March quarter, according to property analyst Cotality's latest Cordell Construction Cost Index. The re-acceleration is likely to weigh on inflation outcomes because the cost of new dwellings comprises the largest weight in the consumer price index, Cotality research director Tim Lawless said. While noting the increase was half the pre-pandemic decade average of one per cent, Mr Lawless said builders struggle with feasibility assessments amid high material and labour costs. "With the cost of building a new home continuing to rise, the (government's) stretch target of building 1.2 million new homes by July 2029 is looking harder and harder," he said. Property Council of Australia policy and advocacy executive Matthew Kandelaars said the uptick in construction costs "chips away at the feasibility of new housing projects" when the nation needs to be accelerating towards the target of 1.2 million new homes. Better investment and tax settings are needed, Mr Kandelaars said, along with smarter and more efficient approvals and more skilled workers to build the homes. "Without this balance, we'll remain stuck in a doom-loop of low margins, constrained project feasibility, cost blowouts and delivery delays." Independent government advice body the National Housing Supply and Affordability Council warned the federal government in a May report that it would fall short of its 2029 goal by about 300,000 dwellings. Western Australia recorded the largest quarterly increase in construction costs in the three months to June at 0.7 per cent, followed by Victoria (0.6 per cent), NSW and South Australia (0.5 per cent) and Queensland (0.4 per cent). Cotality said the latest data reinforces commentary from the Reserve Bank in its July 8 decision to maintain the cash rate at 3.85 per cent, which highlighted as a concern the re-acceleration of growth in the cost of new dwellings via the monthly CPI indicator. In her rates commentary, the central bank's governor Michele Bullock noted certain components of monthly inflation - particularly home-building costs - had been "slightly stronger than expected", which contributed to the decision to hold rates. The RBA added that high construction expenses continue to exert upward pressure on inflation, reinforcing its cautious stance. Competition for skilled trades also remains intense amid a record level of public infrastructure spending, with Infrastructure Australia forecasting a mismatch between the demand and supply of labour until mid-2028. This means continued inflation pressure is likely from building costs centred on the labour market, Mr Lawless said. A rise in construction costs is likely to stoke inflation while pushing home-building targets further out of reach, fresh data analysis suggests. Construction costs rose 0.5 per cent in the June quarter, picking up slightly from a 0.4 per cent rise in the March quarter, according to property analyst Cotality's latest Cordell Construction Cost Index. The re-acceleration is likely to weigh on inflation outcomes because the cost of new dwellings comprises the largest weight in the consumer price index, Cotality research director Tim Lawless said. While noting the increase was half the pre-pandemic decade average of one per cent, Mr Lawless said builders struggle with feasibility assessments amid high material and labour costs. "With the cost of building a new home continuing to rise, the (government's) stretch target of building 1.2 million new homes by July 2029 is looking harder and harder," he said. Property Council of Australia policy and advocacy executive Matthew Kandelaars said the uptick in construction costs "chips away at the feasibility of new housing projects" when the nation needs to be accelerating towards the target of 1.2 million new homes. Better investment and tax settings are needed, Mr Kandelaars said, along with smarter and more efficient approvals and more skilled workers to build the homes. "Without this balance, we'll remain stuck in a doom-loop of low margins, constrained project feasibility, cost blowouts and delivery delays." Independent government advice body the National Housing Supply and Affordability Council warned the federal government in a May report that it would fall short of its 2029 goal by about 300,000 dwellings. Western Australia recorded the largest quarterly increase in construction costs in the three months to June at 0.7 per cent, followed by Victoria (0.6 per cent), NSW and South Australia (0.5 per cent) and Queensland (0.4 per cent). Cotality said the latest data reinforces commentary from the Reserve Bank in its July 8 decision to maintain the cash rate at 3.85 per cent, which highlighted as a concern the re-acceleration of growth in the cost of new dwellings via the monthly CPI indicator. In her rates commentary, the central bank's governor Michele Bullock noted certain components of monthly inflation - particularly home-building costs - had been "slightly stronger than expected", which contributed to the decision to hold rates. The RBA added that high construction expenses continue to exert upward pressure on inflation, reinforcing its cautious stance. Competition for skilled trades also remains intense amid a record level of public infrastructure spending, with Infrastructure Australia forecasting a mismatch between the demand and supply of labour until mid-2028. This means continued inflation pressure is likely from building costs centred on the labour market, Mr Lawless said.
Perth Now
15-07-2025
- Business
- Perth Now
Rising cost to build a wake-up call on housing dream
A rise in construction costs is likely to stoke inflation while pushing home-building targets further out of reach, fresh data analysis suggests. Construction costs rose 0.5 per cent in the June quarter, picking up slightly from a 0.4 per cent rise in the March quarter, according to property analyst Cotality's latest Cordell Construction Cost Index. The re-acceleration is likely to weigh on inflation outcomes because the cost of new dwellings comprises the largest weight in the consumer price index, Cotality research director Tim Lawless said. While noting the increase was half the pre-pandemic decade average of one per cent, Mr Lawless said builders struggle with feasibility assessments amid high material and labour costs. "With the cost of building a new home continuing to rise, the (government's) stretch target of building 1.2 million new homes by July 2029 is looking harder and harder," he said. Property Council of Australia policy and advocacy executive Matthew Kandelaars said the uptick in construction costs "chips away at the feasibility of new housing projects" when the nation needs to be accelerating towards the target of 1.2 million new homes. Better investment and tax settings are needed, Mr Kandelaars said, along with smarter and more efficient approvals and more skilled workers to build the homes. "Without this balance, we'll remain stuck in a doom-loop of low margins, constrained project feasibility, cost blowouts and delivery delays." Independent government advice body the National Housing Supply and Affordability Council warned the federal government in a May report that it would fall short of its 2029 goal by about 300,000 dwellings. Western Australia recorded the largest quarterly increase in construction costs in the three months to June at 0.7 per cent, followed by Victoria (0.6 per cent), NSW and South Australia (0.5 per cent) and Queensland (0.4 per cent). Cotality said the latest data reinforces commentary from the Reserve Bank in its July 8 decision to maintain the cash rate at 3.85 per cent, which highlighted as a concern the re-acceleration of growth in the cost of new dwellings via the monthly CPI indicator. In her rates commentary, the central bank's governor Michele Bullock noted certain components of monthly inflation - particularly home-building costs - had been "slightly stronger than expected", which contributed to the decision to hold rates. The RBA added that high construction expenses continue to exert upward pressure on inflation, reinforcing its cautious stance. Competition for skilled trades also remains intense amid a record level of public infrastructure spending, with Infrastructure Australia forecasting a mismatch between the demand and supply of labour until mid-2028. This means continued inflation pressure is likely from building costs centred on the labour market, Mr Lawless said.
Sky News AU
02-07-2025
- Business
- Sky News AU
Albanese government misses every target of National Housing Accord, falling more than 55,000 homes short in first year
The Albanese government has failed to meet a single target in the first year of its flagship National Housing Accord, falling more than 55,000 homes short of its annual goal. New figures from the Institute of Public Affairs (IPA) reveal the worsening housing crisis amid construction delays and exacerbated supply issues due to immigration. The housing policy, which began in July 2024, aimed to deliver 1.2 million new homes by 2029— or 20,000 homes per month—to improve housing availability and affordability. Analysis by the IPA found that just 185,000 homes have been completed since the accord began, leaving the government over 55,000 dwellings behind schedule. The government's target included 55,000 social and affordable homes, of which just 2,600 were completed in 2024. 'The federal government's National Housing Accord is one year old and already tens of thousands of homes behind target,' Director of Research at the IPA Morgan Begg said. 'In its first year of operation, the National Housing Accord as failed to hit a single target. 'At the same time the federal government is bringing in 1.3 million new migrants over three years, Australia is being set up for a disaster.' The latest forecast from the National Housing Supply and Affordability Council projected the government will fall 250,000 homes short of its target by 2029. Meanwhile, bureaucratic red tape has strangled the number of new homes being built as the time taken to build a new dwelling continues to grow. According to findings based on Australian Bureau of Statistics data, it takes 50 per cent longer to build a house in 2025 compared to a decade ago. 'There is unprecedented demand for new homes. Yet it is taking far longer to build them, and it costs significantly more to do so,' Mr Begg said. The IPA also pointed to the contradiction between falling construction rates and rising net migration, with about 1 million migrants set to come in by 2029. The federal budget papers have forecast net overseas migration of 260,000 in 2025-26 and then 225,000 in the subsequent three years. 'There is no plan on how to house new arrivals … This is a manufactured housing disaster,' Mr Begg said. The damning findings follow similar warnings from the National Housing Supply and Affordability Council (NHSAC). In its State of the Housing System 2025 report, the council projected that only 938,000 homes would be built by June 2029—over 250,000 homes short of the federal target. It noted that no state or territory was on track to meet its share of the target, based on population. ABS figures show just 177,000 dwellings were completed in 2024—well below the estimated underlying demand of 223,000. The Albanese government increased total housing commitments to $33 billion in the 2025 federal budget, including the $10 billion Housing Australia Future Fund. Housing Minister Clare O'Neil has defended her approach, arguing 'it takes time to turn the tide on a housing crisis a generation in the making'. The Property Council of Australia (PCA) has since called on governments to redouble efforts to boost housing supply productivity. 'We're projected to be 262,000 homes behind the 2029 target but imagine the gap without these reforms,' PCA Chief Executive Mike Zorbas said in a statement. 'We … desperately need to address falls in productivity that mean we're building fewer than half as many homes per hours worked today than in the mid-1990s. 'We need to move from 170,000 homes a year into the high 200,000s to meet the Accord's target. 'That requires bold leadership to dissolve assessment and approval gridlock in key corridors.'
The Age
10-06-2025
- Business
- The Age
Average Australian home value passes record $1 million
The value of an average Australian home has soared through the $1 million mark for the first time despite a slowdown in growth as the Albanese government fights to contain the housing affordability crisis. Fresh figures released by the Australian Bureau of Statistics on Tuesday showed the average Australian home was worth $1,002,500 in the March quarter, up $6900 from the last three months of 2024. The total value of the country's $11.4 trillion residential housing market climbed $131 billion – or 1.2 per cent – in the first three months of the year. All states and territories recorded growth in the March quarter, but the annual growth rate slowed to 5.9 per cent, down from 9.5 per cent at the same time last year. It came as the number of residential homes grew to 11.3 million, up 53,400 from the December quarter. The Albanese government, which swept into its second term on an overwhelming majority, has promised to improve housing affordability. However, its own independent adviser, the National Housing Supply and Affordability Council, warned that the Labor government's National Housing Accord was set to fall 262,000 short of its 1.2 million target for new homes by the end of the decade. Prime Minister Anthony Albanese, speaking at the National Press Club on Tuesday, said a key barrier to affordable housing was red tape. 'One of the things that we have to do is to make it easier,' he said. 'Developers say that it's just too complex [and it] adds to costs as well.'
Sydney Morning Herald
10-06-2025
- Business
- Sydney Morning Herald
Average Australian home value passes record $1 million
The value of an average Australian home has soared through the $1 million mark for the first time despite a slowdown in growth as the Albanese government fights to contain the housing affordability crisis. Fresh figures released by the Australian Bureau of Statistics on Tuesday showed the average Australian home was worth $1,002,500 in the March quarter, up $6900 from the last three months of 2024. The total value of the country's $11.4 trillion residential housing market climbed $131 billion – or 1.2 per cent – in the first three months of the year. All states and territories recorded growth in the March quarter, but the annual growth rate slowed to 5.9 per cent, down from 9.5 per cent at the same time last year. It came as the number of residential homes grew to 11.3 million, up 53,400 from the December quarter. The Albanese government, which swept into its second term on an overwhelming majority, has promised to improve housing affordability. However, its own independent adviser, the National Housing Supply and Affordability Council, warned that the Labor government's National Housing Accord was set to fall 262,000 short of its 1.2 million target for new homes by the end of the decade. Prime Minister Anthony Albanese, speaking at the National Press Club on Tuesday, said a key barrier to affordable housing was red tape. 'One of the things that we have to do is to make it easier,' he said. 'Developers say that it's just too complex [and it] adds to costs as well.'
