Higher-density projects drive the latest uplift, yet Housing Accord target remains out of reach
Australia’s home building pipeline strengthened in November, but industry and policy targets remain well out of reach, raising ongoing concerns about future housing supply and affordability pressures.
Latest Australian Bureau of Statistics (ABS) data show 193,299 new homes were approved in the 12 months to the end of November, a more-than three-year high and around 20,000 higher than the previous year’s tally. The improvement has been driven largely by a rebound in higher-density projects, particularly apartments and units.
On a monthly basis, total dwelling approvals rose 15.2% in November to 18,406 on a seasonally adjusted basis, with multi-unit approvals leading the gains. According to the ABS, approvals for private sector dwellings excluding houses surged 34.1% in the month, following a 13.5% fall in October, while private detached house approvals rose 1.3% to 9,458.
“The rise in total dwellings was driven by a 34.1% rise in approvals for private dwellings excluding houses,” said Daniel Rossi, ABS head of construction statistics. “This follows a 13.5% fall in this series in October. Private sector houses also rose, up 1.3%.”
Higher-density approvals have been particularly strong in Queensland and Victoria. In original terms, apartments rose 63.6% in November to 5,558 dwellings after a 39.2% drop in October, and the series now sits 44.8% above its average over the past year. Queensland and Victoria led the increase in apartments, with Queensland’s approvals lifting to 1,878 from 634 in the prior month, and Victoria’s rising to 1,496 from 598.
At state level, New South Wales and Queensland recorded the largest monthly rises in private sector house approvals, up 4.3% and 3.9% respectively, while South Australia saw a 3.7% decline.
The overall value of building work approved also strengthened in November. Total building approvals were valued at $18.34 billion, up 12.8% from October. Residential work was the main driver: the value of total residential building rose 26.3% to $11.34 billion, reaching a new high, with new residential building up 30.4% to $10.14 billion. Alterations and additions edged 0.1% lower to $1.20 billion. Non-residential building approvals fell 3.9% to $7.04 billion but remained 15.1% higher than a year earlier.
The latest figures point to a modest improvement in future supply, but one that remains insufficient to ease affordability constraints in the short to medium term. Industry bodies continue to highlight the gap between approvals and the levels required to satisfy commitments under the National Housing Accord.
Shane Garrett, chief economist at Master Builders Australia (MBA), has previously noted that during the first year of the Accord, approvals fell about 60,000 homes short of the required trajectory, implying that 255,000 new homes a year are now needed over the remaining four years to catch up.
MBA chief executive Denita Wawn (pictured below left) pointed to ongoing capacity and productivity issues within the construction sector. “Right now, we are grappling with skilled workforce shortages while our abysmal productivity performance is slowing down work and preventing many new home building projects from proceeding at all,” she said.
“If we could build more homes, housing cost pressures would mellow which would have favourable implications for wages and costs right across the economy especially considering housing costs are the biggest contributor to our economy’s inflationary pressures.”
Matthew Kandelaars (pictured above right), group executive policy and advocacy at the Property Council of Australia, welcomed the uplift in the November figures but also pointed out that dwelling approvals had to be delivered more consistently to meet the National Housing Accord target of 1.2 million homes.
“One good month doesn’t solve the housing shortage,” he said. “While more than 271,000 dwellings have been approved since the start of the National Housing Accord, we need a sustained run rate and a pipeline of feasible projects that can keep moving month after month.”
Kandelaars said the next reform priority would be turning approvals into starts and completions by speeding up post-permit processes. “Planning approval is just the first bottleneck,” he stressed. “Too many projects then get stuck waiting for the next set of sign-offs. Power and water connections, utility upgrades, subdivision and titling, certification, and other post-permit steps.”
“If governments want more homes on the ground sooner, this is where the focus needs to shift. Streamline the post-permit pathway, set timeframes, coordinate utilities, and keep pushing reforms that lift feasibility and delivery.”
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