Housing shortage tracking toward 500,000
If current residential building trends persist, Australia will have a shortfall of 466,000 dwellings by 2020, the Housing Industry Association says.
The finding is contained in the association's Housing to 2020 report, which examines future housing demand and the number of dwellings required to meet it.
The housing shortage already numbers 109,000 dwellings, the report says, as high migration pumps up demand while new building remains lacklustre.
"The reality in many regions and cities in Australia is that affordable, well-located land isn't available or abundant," says the association's senior economist, Ben Phillips.
"Furthermore, planning restrictions, higher taxation on new housing relative to existing dwellings, labour shortages and onerous regulation biased toward new housing all add to the problem.
"If we don't get a comprehensive supply response to the accumulating housing shortage then the lack of affordable and appropriately located rental properties will only worsen, while pressures on existing home prices will continue at an undesirable rate, placing avoidable upward pressure on interest rates," Phillips adds.
The report finds housing shortages exist in 295 of Australia's 669 local government areas, with metropolitan Sydney and Brisbane accounting for the majority.
Business commentator Robert Gottliebsen says demand for housing is being fanned on all fronts, while a supply squeeze is being applied.
Writing in the Eureka Report online newsletter, Gottliebsen attributes the supply squeeze to: banks shying away from lending to developers; high migration rates; government regulations and taxes; and the competition between superannuants and overseas buyers for investments.
"This formula has meant that investing in property has been very profitable in recent times and, given the shortage of dwelling stock, looks like being attractive for some time into the future, or at least until the squeeze play is unwound and supply is lifted substantially," he writes.
