Range of incentives needed to solve housing crisis: HIA

The peak body for residential building has pushed policymakers to take action to reach state and national housing targets in the near future.

tom devitt HIA spi iuml3x

The Housing Industry Association (HIA) urged state and federal policymakers to pull levers within their reach as Australia faces an “acute” housing shortage and record population growth that are expected to prolong for at least the next few years.

The association’s senior economist Tom Devitt said that policy changes have become increasingly necessary with recent inflation data decreasing the likelihood that the Reserve Bank of Australia (RBA) will reduce interest rates this year.

Moreover, further increases in residential lot prices in some markets in the recent past point to more land constraints in the industry even as materials and labour constraints ease, he added.

“State and federal policymakers need to incentivise local authorities to accelerate the release of shovel-ready land and permit higher density development in existing suburbs near jobs and transport,” Devitt said.

“Addressing tax, planning, land, and regulatory constraints on the housing industry is the only hope of reaching state and national housing targets in coming years and addressing the country’s housing crisis.”

Devitt’s comments were in response to new data which revealed that home building approvals have remained around decade lows, according to the Australian Bureau of Statistics (ABS).

“These depressed approvals volumes don’t foreshadow a rapid recovery from the weakest volume of new home commencements in the 2023/24 financial year, in over a decade,” Devitt said.

The monthly building approvals seasonally adjusted data for April 2024 showed that total dwellings approved fell 0.3 per cent to 13,078.

The number of detached dwellings approved fell 1.6 per cent to 8,822, while the number of private sector dwellings excluding houses fell 1.1 per cent to 3,981.

Total dwelling approvals contracted in Tasmania (16.1 per cent), NSW (4.5 per cent) and Western Australia (0.9 per cent).

On the other hand, they rose in South Australia (13.9 per cent) and Queensland (5.0 per cent), while Victoria was flat in April.

Meanwhile, approvals for private sector houses decreased in NSW (5.0 per cent), Victoria (2.0 per cent), Queensland (0.2 per cent), and South Australia (0.1 per cent), but climbed in Western Australia (3.5 per cent).

Private sector dwellings excluding houses include semi-detached, row or terrace houses, townhouses, and apartments.

The value of new residential building fell 3.8 per cent to $6.16 billion (after a 13.8 per cent rise in March). Similarly, the value of non-residential building fell 4.6 per cent to $5.12 billion following a 21.7 per cent rise.

The value of total residential building fell 3.2 per cent to $7.28 billion. It comprised a 3.8 per cent decrease in new residential building and a 0.4 per cent rise in alterations and additions.

In seasonally adjusted terms, dwelling approvals increased in the three months to April in Western Australia compared to the previous year (39.4 per cent) and Victoria (+2.8 per cent), while NSW was flat.

Approvals declined in jurisdictions, however, led by Queensland (down 16.6 per cent), followed by Tasmania (down 12.2 per cent) and South Australia (down 11.3 per cent).

In original terms, dwelling approvals plummeted in the Northern Territory (down 38.2 per cent) but increased by 4.1 per cent in the ACT.

If you’re looking to refinance for a better rate or the right rate for your clients at zero cost, contact Finni Mortgages’ experts and let us do the hard work for you.

Visit our website here or call 1300 002 023 to learn how we can help you!

company profile

Latest articles

You need to be a member to post comments. Become a member for free today!

Comments powered by CComment

Related articles