Residential building approvals record slight lift
Dwelling approvals are on the rise, but the building industry says small gains aren’t cause for celebration.
According to the Australian Bureau of Statistics, in seasonally adjusted terms the total number of dwellings approved rose 1.9 per cent over the month of March compared to February while recording a 2.2 per cent drop over the year.
House approvals rose 3.8 per cent during the month and 7.3 per cent over the year, while multidwelling builds were up 3.6 per cent over the month but dropped 16.8 per cent from a 12-month perspective.
Master Builders Australia’s chief economist, Shane Garrett, noted that these results indicated “just 161,500 new homes have been approved over the past year”.
The organisation’s CEO, Denita Wawn, added that the latest figures painted a worrying picture of the country’s ability to build the homes it has promised.
“These figures stand in sharp contrast to the yearly target of 240,000 new homes under the National Housing Accord,” Wawn said.
“The Accord takes effect in less than two months’ time, and if we are going to have any chance of meeting this target, we need to lift new home building by 50 per cent from current levels over the next five years,” she noted.
Wawn pointed to a number of issues plaguing the construction sector for causing delays and disincentivising home building.
“Despite the will of governments to get home building activity moving, there are still too many obstacles in our way.
“Chronic tradie shortages, planning and licensing delays, draconian industrial relations changes, material cost inflation, inefficient regulation, unfeasible lending practices and risk allocation are making projects unsustainable,” she said.
Master Builders is hoping to see a concerted effort to address many of these issues in the federal government’s next financial plan.
“We have to make it easier to build new homes by bringing down the cost of construction. This must be a priority in the upcoming federal budget,” Wawn said.