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‘Far from healthy’: the grim projections for Australia’s housing market

Key points
  • The State of the Housing System report concluded that Australia’s housing market is “far from healthy”.
  • The report predicts that the situation will worsen and that new housing construction targets will not be met.
  • The National Housing Supply and Affordability Council calls for the system to better meet community demands.

Australia’s housing system is failing to meet demand, and new supply will remain 39,000 homes short of new demand by 2028-29.

The State of the Housing System 2024 report, published by the National Council on Housing Affordability and Supply, has analyzed housing affordability in Australia.
Now, the council is calling for the system to be more responsive to the needs of the community.
Council president Susan Lloyd-Hurwitz said there was no denying Australia was in a housing crisis.

“It is a long-standing crisis, driven fundamentally by the inability to provide sufficient housing of all types, from social housing to market-owned housing,” he said.

Rising public spending on housing still does not alleviate the rental crisis

“The problems in our housing market are deeply rooted and there is no easy solution.

“Building a better system will require focused, coordinated and consistent long-term efforts across jurisdictions.”

By the numbers

According to the report, 169,000 households are on public housing waiting lists and 122,000 people are homeless.
Waiting lists for First Nations housing increased by 10 per cent during the 2022-23 financial year.
The report found that the main reason for worsening affordability was that the system did not provide enough housing.
In 2023, only 172,000 homes were completed, the lowest annual number of completions in the last decade.
The council’s modeling projected that Australia will miss its target of 1.2 million new homes.
“At its core, this crisis is due to insufficient supply, but many contributing factors are exacerbating it: the resumption of migration at an accelerated pace, rising interest rates, skills shortages, high numbers of insolvencies of construction companies, weak consumer confidence and cost inflation, to name just a few,” Lloyd-Hurwitz said.
The report found worsening affordability is “particularly problematic” for vulnerable groups, including low-income households, those fleeing domestic or family violence, First Nations Australians and young people.

Council has proposed 10 focus areas to improve the system, including investing in social housing, increasing building capacity and First Nations outcomes.