Australia’s housing sector faces a steep uphill battle to meet national construction goals, as new data reveals a sharp drop in approvals for new homes in March.
The Australian Bureau of Statistics reported an 8.8 per cent decrease in total dwelling approvals for March, falling to 15,220 homes — a six-month low and well below the 20,000 homes per month needed to reach the federal target of 1.2 million new homes by 2029.
The decline was led by a 27.4 per cent plunge in apartment approvals, which dropped to 3,055, while single-family home approvals fell by 4.5 per cent.
Property Council of Australia Group Executive Policy and Advocacy Matthew Kandelaars called the figures “another reminder of the tough road ahead to reach our housing goals”.
He noted: “March saw a fall in approvals across all housing types, with a particularly stark fall in apartment approvals reflecting the challenges faced to hit our national housing target.
“Apartment approval data is volatile, but their long project timelines need stable tax and planning policies. Certainty is critical when these projects take years to build.
“Even once a project is approved, labour shortages, state-based development-killing taxes and elevated construction costs are all putting pressure on new housing starts.
“We need an ‘all-in’ approach to turn these figures around.”
The drop in apartment approvals was particularly acute in Victoria, where approvals fell to just 671 in March from 2,294 in February.
New South Wales saw a modest improvement, with 4,032 homes approved in March-up from February’s low but still well short of the 6,250 monthly approvals needed to meet the state’s National Housing Accord target.
“The past three years have established the strong foundations for Australia to build more homes, and with the election behind us, now it is time to shift to the delivery phase,” said Kandelaars.
“We look forward to early industry engagement to get the detail of the government’s election commitments right and to maximise their housing benefits right across the country.”
Industry leaders continue to urge governments to accelerate planning reforms and address bottlenecks in the construction pipeline, warning that without swift action, Australia risks falling further behind on its housing ambitions.
