NSW is more than two years behind schedule to deliver its share of 1.2 million homes the federal government hopes to have built across the country by the end of the decade, ensuring price pressures on the nation’s most expensive property market will remain entrenched.
The first review of how the states and territories are tracking against their individual housing targets under the federal housing accord suggests that it may not be fully met until the mid-2030s.
The Albanese government has set a target of 1.2 million new homes between mid-2024 and mid-2029. Property prices have surged since 2020 with the median house value in Sydney, Brisbane, Perth and Canberra now more than $1 million.
The National Housing Supply and Affordability Council on Wednesday said that nationally, just 18 per cent or about 219,000 homes had been completed since the accord started. At the current rate of housing construction, the target will not be met until mid-2030.
But NSW, which has a state target of 377,000 homes, has so far only built 15 per cent. Without a lift in construction activity, it won’t reach its target until the middle of 2031.
Victoria, the ACT and Western Australia are on track to get closest to the mid-2029 target, with each behind by just three months.
But the Northern Territory, which has the smallest target of just 11,500 homes, has built just 5 per cent of its target. The council estimates the NT won’t reach its target until after 2034.
Other laggards include Tasmania, on track to hit its target in September 2033, Queensland (September 2030) and South Australia (September 2030).
Council chair Susan Lloyd-Hurwitz said progress was being led by WA, Victoria and the ACT, noting that supply could be affected by the split between stand-alone homes and apartments being built in each jurisdiction.
“The quarterly report highlights the tangible progress that has been made since the start of the accord period and the continuing efforts by states and territories to increase the supply of housing,” she said.
The council said there had been a 17 per cent increase in quarterly housing starts since the accord was put in place, while the time to build a new home had improved by 10 per cent.
The data, however, pre-dates last week’s decision by the Reserve Bank to lift official interest rates, which is expected to slow demand for housing construction.
Treasurer Jim Chalmers on Tuesday told business leaders that the May 12 federal budget would contain a package of reforms that would help improve the rollout of new homes.
“The productivity package will be substantial, and it will be all about making it easier and faster to build, more attractive to invest, and to try and get some of your compliance costs down,” he said.
Opposition housing spokesman Andrew Bragg said the federal government should be doing far more to cut red tape that was holding back new homes.
Bragg is heading a Senate committee that is examining economy-wide productivity. It is now taking submissions on ways to remove impediments from the housing sector.
He said the National Construction Code, currently 2000 pages, could be cut by at least two-thirds.
“Surely, in the age of artificial intelligence, we can cut the backside out of this ridiculous, ugly code, which is undermining homeownership. We can make it easier and faster to comply with the code,” he said.
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