Australia is facing a housing crisis with industry figures showing the rate of new builds stalling, as immigration numbers surge.
Housing industry figures to be released next week show the number of new home build starts over the next three years will remain static while immigration numbers surge.
In the three years to June 2025, the Housing Industry Association is predicting 535,000 new homes will be commenced, during which time net overseas migration is set to hit 970,000.
The new figures come as last week’s budget revealed the government expects investment in home construction and renovation to decline this financial year and for the two following years.
The budget said rents will rise for “the next few years as increases in advertised rents flow through to existing lease agreements when they are renewed”.
The rental market is already tight “with national vacancy rates at near record lows of around 1 per cent and advertised rents growing at over 10 per cent as of April 2023”.
On Tuesday night Treasurer Jim Chalmers announced the Commonwealth Rent Assistance would raise rent assistance by 15 per cent at a cost of $2.7 billion over five years.
Housing industry figures show the number of new build starts over the next three years will remain static — while immigration numbers surge. Picture: Seb Haggett
Total dwelling investment is expected to fall by 2.5 per cent this financial year, 3.5 per cent next and 1.5 per cent in the year to June 2025, the budget papers said.
The collapse in dwelling investment and expected flat-lining of new start numbers comes as the population is soaring.
— NSW’s population is forecast to hit 8,734,000 in 2026-27 an additional 434,000 people or 1669 each week
— Victoria’s population is forecast to hit 7,314,000 in 2026-27, an additional 534,000 people or 2053 each week.
— Queensland’s population is forecast to hit 5,782,000 in 2026-27 an additional 341,000 or 1311 people per week.
ABS data released last week showed the first quarter of 2023 had the lowest number of building approvals in a decade.
The data showed a 15 per cent drop in new approvals year-on-year to March, with economists expect the number to get worse as the period covered by the new data did not cover all of the RBA interest rate rises.
Treasurer Jim Chalmers announced the Commonwealth Rent Assistance would raise rent assistance by 15 per cent. Picture: Martin Ollman
Total building approvals were down were down in seasonally adjusted terms by 34.1 per cent in NSW and 26.6 per cent in Victoria, followed by 14.9 per cent in WA, 10.8 in Tasmania and 5.7 per cent in South Australia
Queensland was the only state to buck the trend with a 8.6 per cent increase.
Opposition Housing spokesman Michael Sukkar said that over the next five years the government was planning on bringing in 1.5 million migrants while dwelling construction was at its lowest levels in over 10 years and housing investment was falling.
“Where does Labor think they’re going to live?” he said.
He said the government had given up on young Australians ever owning a home.
“The Coalition will never accept a generation of Australians not having the opportunity for home ownership,” he said.
“We are more committed to home ownership than ever, while Labor is putting its agenda for a ‘Big Australia’ ahead of the interests of young Australians.”
Opposition Immigration spokesman Dan Tehan said Labor had no plan to deal with the housing and rental crisis and instead “cutting infrastructure investment that will help alleviate congestion problems exacerbated by overpopulation.”
“Labor cut $1.7 billion from road transport projects in this week’s budget, which is on top of the $9.6 billion cut from the infrastructure budget last October and with further savage cuts expected following their 90-day infrastructure review,” he said.
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