February has turned out to be another shocker for Australia’s home-building industry, which faces an uphill battle supplying homes for Australia’s ballooning population.
Only 162,200 dwellings were approved for construction in the 2023 calendar year.
This was the lowest annual result since March 2013, below the historical average, and some 78,000 lower than the Albanese government’s housing target, which requires 240,000 homes to be built a year.
Loans for purchasing or constructing a new home also remained near record low levels in December 2023:
Chart by HIA
The Housing Industry Association (HIA) released its new home sales figures for January, which dipped a little over the month and fell again in three-month average terms.
The below chart from Justin Fabo at Antipodean Macro illustrates the situation, with new house sales leading dwelling approvals lower:
Earlier this month, HIA Senior Economist Tom Devitt sounded the alarm, noting that “the steepest RBA rate hiking cycle in a generation has compounded the elevated costs of home building, seeing potential home buyers squeezed out of the market and fewer new homes commencing construction”.
“This lack of new work entering the construction pipeline is expected to produce a trough in new house commencements in 2024, when Australia will start construction on just 95,400 new houses, the weakest year in over a decade”.
“At a time of record population growth and acute shortages of rental accommodation, a dwindling supply of new homes threatens to worsen Australia’s housing crisis”, Devitt said.
The contraction in housing construction has occurred alongside the record rise in Australia’s population via net overseas migration.
As a result, Australia’s housing shortage will intensify, raising both prices and rents.
It is an inequality disaster in the making, caused first and foremost by the federal government’s insane mass immigration policy.
The only viable solution is to cut immigration to a level below the nation’s capacity to build homes and infrastructure.
Otherwise, the housing situation will continue to worsen.
