Skip to content
Building Construction

Latest ABS data shines light on housing pipeline squeeze

Master Builders Australia 3 mins read

2 February 2024

The Australian Bureau of Statistics (ABS) has unveiled a comprehensive snapshot of economic indicators this week, painting a troubling picture for the nation's housing landscape says Master Builders Australia CEO Denita Wawn.

With the release of data on inflation, building approvals, lending indicators, and building materials prices, it's evident that the trajectory is veering off course, exacerbating the existing housing crisis.

Renters, mortgage holders, and builders alike find themselves ensnared in a tightening grip as these vital metrics spiral in unfavourable directions.

Producer price index

Having stabilised during the September 2023 quarter, there were hopes that building materials costs might have fallen during the December 2023 quarter.

The 0.3 per cent increase which occurred during the last three months of 2023 is an unwelcome result and means that building materials are over one third more expensive (+33.5 per cent) than before the pandemic.

Over the past year, costs pressures have been particularly acute when it comes to bricks (+13.5 per cent), paint (+11.6 per cent), sand (+11.0 per cent) and plaster products (+9.9 per cent).

Combined with continued labour supply pressures, the resumption of building materials price rises is likely to frustrate efforts to expand the stock of new homes.

December building approvals

Higher-density approvals have dropped to an 8-month low amid persistent rental pressures.

Falling by 22.4 percent during December 2023, overall building approvals saw a total reduction of 9.5 per cent over the month.

The deteriorating pipeline of higher density homes dragged down the overall number of new home building approvals which dropped by 9.5 per cent.

Compared with a year ago, the volume of new unit and apartment approvals is now 44.8 per cent lower.


Latest inflation figures show, rental price pressures remain significant. This is the result of a prolonged phase of underbuilding on the higher density side of the market – a problem which predates the pandemic.

Right now, we are seeing the volume of approvals in this part of the market shrinking back from already minimal levels.

This is the last thing we need at a time when the gulf between supply and demand is so huge. Urgent action is required right across the board to increase the flow of new homes onto our rental market.

Bad outcomes in the rental market don’t just hurt renters. They also damage our economy’s ability to grow by restricting the number of new workers we can accommodate and placing upward pressure on wages.

Lending indicators

2023 saw home lending for new home construction hit a record low since data started being recorded in 2003.

During December, there was a 5.6 per cent reduction in the total value of housing loans to owner occupiers while investor lending fell by 1.3 per cent.

Poor sentiment amongst owner occupiers resulted in the number of loans for newly built homes declining by 4.9 per cent while existing home loans suffered an 8.2 per cent reduction.

The figures for December highlight the fact that the demand side of the new home building market is struggling at the same time as obstacles on the supply side persist.

The pipeline for new homes is shrinking and not showing assurances that people are able to build new homes.

To hit the 1.2 million homes target the volume of new home lending needs to be significantly higher.

The weak set of lending figures adds further to the case for the RBA to start reducing interest rates as soon as possible.

Decisive action needed

Master Builders acknowledges that Governments at all levels are starting to make inroads, and this will take time to flow through the market but more needs to be done to speed up the delivery of new homes.

Tradies remain deeply concerned with the impact the Federal Government’s Closing Loopholes Bill currently before the parliament will have on the sector and the housing crisis more broadly.

We are not building enough homes and when we do – they take too long to build and are too expensive. With these changes, it would only get worse. Everyone pays a price when there are fewer tradie businesses and higher costs for builders.


Media contact: Dee Zegarac, National Director, Media & Public Affairs

0400 493 071 |


More from this category

  • Building Construction, Property Real Estate
  • 18/07/2024
  • 09:00
New Romans

Keyton land acquisition expands its Victorian development pipeline

Keyton, one of Australia’s leading retirement living developers, has acquired its first landparcel under its new name with the purchase of 500 Burwood Highway in Melbourne’s leafygreen Vermont South. “This is an exciting milestone for Keyton as we pursue our growth strategy both here inVictoria and across Australia,” said Nathan Cockerill, Keyton Chief Executive Officer. “This is the first acquisition we have made since we stood up Keyton as an independentbusiness from our Lendlease retirement living origins and I commend the team, led by Headof Development Jason Fitzgerald, for successfully executing the purchase. Jason Fitzgerald says this acquisition is a…

  • Contains:
  • Building Construction
  • 17/07/2024
  • 14:44
Australian Constructors Association

ACA welcomes government support for CFMEU administration

The Australian Constructors Association (ACA) applauds Workplace Relations Minister Tony Burke’s announcement today, committing to “immediate” action for appointing independent administrators to the CFMEU’s construction branches. Prime Minister Anthony Albanese confirmed that this action will incorporate the NSW and QLD branches of the CFMEU. ACA CEO Jon Davies said, "Whilst the joint media investigation has uncovered criminality, corruption and coercive behaviour in the Victorian branch of the CFMEU, the problems are not limited to Victoria.” “This action, as opposed to de-registration, will importantly mean that workers will still have access to workplace representation if needed,” said Mr Davies. “It should…

  • Contains:
  • Building Construction, Government Federal
  • 17/07/2024
  • 12:05
Master Builders Australia

Statement on Federal Government and Fair Work actions re CFMEU

17 July 2024 Master Builders Australia welcomes today’s announcement that the Fair Work Commission is seeking advice on making an application to appoint an independent administrator to oversee the CFMEU. The announcement is a significant move in addressing a range of serious allegations against the CFMEU while ensuring workers retain access to workplace representation if they choose. It is also an important first step towards stamping out the toxic and ingrained culture within building unions of bullying, thuggery, and complete disregard for the law. We also appreciate Minister Burke’s commitment to support the application and to introduce legislation in the…

  • Contains:

Media Outreach made fast, easy, simple.

Feature your press release on Medianet's News Hub every time you distribute with Medianet. Pay per release or save with a subscription.