Housing affordability is getting worse as Australia falls short of 50,000 homes

Australia’s housing supply is expected to worsen in 2026 as the country’s new permits continue to fall nearly 50,000 short of government targets.

Experts now believe it could be another decade before homebuyers begin to see the benefits of nationwide planning and construction industry reforms aimed at improving the supply of new homes and improving affordability.

Australian Bureau of Statistics building approvals data released today show that by the end of November Australia had opened 193,299 new homes in the previous 12 months.

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That’s up 20,000 from the same period last year, and is up more than three years as the best number since mid-2022.

Most of the gains came from an increase in house and unit approvals, with data showing strong increases across all states – with Queensland recording its highest number of new approvals per month in that part of the property market since 2016.

New housing permits are at their highest level in more than three years.

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However, Housing Industry Association chief economist Tom Devitt said part of the reason for the increase in new unit approvals is that the prices of established homes in that sector have risen enough to make them viable.

Mr Devitt said there was a growing question as to whether the target of 240,000 new builds a year, or 1.2 million homes by July 2029, as part of the National Housing Accord’s bid to improve housing availability was actually enough to improve housing availability.

This Agreement is an important part of the Albanian government’s efforts to deal with the housing crisis that is felt in almost every corner of the country.

And with the approval of Australia, which does not continue to be built at all, they are still about 50,000 short of their annual goal, he said that employers and those who buy nursing homes should expect that affordability will worsen in 2026.

HIA chief economist Tom Devitt has warned Aussie housing availability will worsen in 2026 for buyers and renters.

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“Increasing mortgage rates makes foreclosures more efficient … which is exactly what we want to see, and what policymakers want to see,” he said.

“But it still won’t reach the kind of numbers needed to target the Agreement, so at least this year, housing availability will continue to get worse.

“The next housing reform is starting, but it will not reach its full potential unless the policy settings support it.”

The ABS data also showed that the national median house approval is at a record $519,906.

Oxford Economics … Tim Hibberd said that was up 6.5 per cent last year, with even bigger jumps in South Australia, up 16.4 per cent, and Victoria, up 7.9 per cent.

Experts believe more than a million new homes are needed to solve Australia’s housing crisis.

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Mr Hibberd said housing is “a disaster” affecting the movement of the Consumer Price Index, and although he did not suggest that rising prices would lead to higher prices, he said there did not seem to be any major signs of easing to come.

Mr Devitt said an interest rate hike was now “more likely than it was six months ago”, however he noted that the HIA had not expected any for the first half of 2026.

Oxford Economics expects that the country may start to reach 240,000 new approvals by the middle of 2028, but even so they do not expect any improvement in housing purchases until the end of the decade and possibly after 2030.

“It’s going to be a long journey,” said Mr Hibberd.

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