Building a home in Australia now takes nearly 50% longer than it did four years ago, with average times for houses, townhouses, and apartments reaching 13, 16, and 33 months, respectively, in the 2024 financial year, PropTrack reported.
Data from ABS showed these are the longest build times since records began in 2010.
Megan Lieu (pictured above), an economic analyst at REA Group, attributed the delays to ongoing issues such as high material costs and labour shortages.
“For all property types, completion times are the lengthiest they have been in 15 years,” Lieu said, noting signs of stabilisation for houses but continued delays for townhouses and apartments.
Supply chain disruptions, particularly during the pandemic, created significant shortages in key building materials. From steel to timber, prices soared, with steel peaking at 42% annual growth in March 2022.
“Homes were not only becoming more expensive to build but their timelines from commencement to completion were majorly extended,” Lieu said.
Although supply chain issues have eased for most materials, costs remain elevated, and some shortages persist, especially for copper used in electrical components.
A persistent shortage of skilled construction workers has further extended home build times.
The construction industry recorded the largest labour undersupply among all sectors in the year leading up to June 2024. Despite rising wages, apprenticeship commencements fell by 12% over the same period.
“This shortage is concerning given the government’s target to build 1.2 million homes in the next five years,” Lieu said.
Labour shortages have left 85% of construction companies struggling to hire suitable workers, further delaying projects.
While national trends are concerning, some states have seen improvements. Townhouse build times dropped 16% in Queensland and 32% in the Australian Capital Territory.
For apartments, Queensland saw a 17% decrease, while Victoria remained stable. However, New South Wales experienced a 17% increase in apartment build times.
The prolonged building environment is likely to worsen the housing shortage, driving up prices. Addressing labour shortages, including promoting apprenticeships and skilled migration, could help ease delays.
“More needs to be done to meet housing demands,” Lieu said, adding that while some trends show improvement, broader solutions are essential to tackle Australia’s growing housing crisis.
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