Australia needs to build 186,000 new houses a year: HIA

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The Housing Industry Australia has released a report that analyses the nation’s future building requirements. The report has revealed that the largest policy challenge faced by the Australian property market will be ensuring a sufficient supply of new dwellings to house our growing and ageing population.

"Within a plethora of potential scenarios, the most likely outcome is an annual new home building requirement between now and 2050 that is considerably higher than was has been achieved over the last 20 years,” HIA economist, Geordan Murray said.

“In a scenario where Australia’s population and its real incomes grow at a medium rate – a scenario we believe most plausible – the nation will need to build an average of around 186,000 dwellings per annum.”

The total requirement comprises 152,000 homes to provide housing for new households and between 30,000 to 35,000 dwellings to offset demolished homes and to satisfy the demand for additional housing attributable to a rise in real household incomes.

“In 2013/14, the number of new homes built was about the same as the number of new homes demanded by the population during the year. Unfortunately a match of this kind is an aberration - throughout much of the last decade there was a considerable mismatch between the level of demand for housing and the amount of new home building,” Murray said.

“The challenge for governments is to ensure that policy settings will enable alignment of demand and supply to persist over the long term. This is a policy area deserving of prioritised and coordinated action from all levels of government.”


 

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Comments
  • Jeremy Sheppard says on 16/10/2014 01:52:38 PM

    If there is a considerable shortage in supply of property, prices will go up. If prices go up considerably, developers' eyes will light up with dollar signs as they see more profitable opportunities. In fact, mum and dad investors might even jump into development. Soon there will be enough stock to satisfy demand. If however, they go too far, which is inevitably the case, there will be an oversupply and price growth will be subdued or even fall.

    The government doesn't need to do anything. The law of supply and demand will naturally cause more property to be built when there is a clear shortage and vice-verse. Save your breath, no need to ask the government to go meddle in it and stuff things up. They've got enough other things to worry about. Tax payers don't want another expensive committee trying to solve phantom problems.

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