Despite all levels of government acknowledging the challenges around planning, workforce and productivity, Master Builders WA CEO Matthew Pollock says “we aren’t seeing enough flow through on the ground”. Photo: Chameleonseye.
New industry forecasts show Western Australia is inching closer to its Housing Accord target, despite construction delays in off-the-plan developments.
Five months after the first predictions came through for the five-year accord period, Master Builders project a decrease in the state’s housing shortfall from 15,420 to 5912. Between 1 July 2024 and 30 June 2029 it expects 124,128 new home starts, which is 4.65 per cent lower than the target.
WA and South Australia are the only two states that have moved closer to their goals, according to Master Builders WA CEO Matthew Pollock.
“The downgrade in the national April forecasts is off the back of a prolonged battle to curb inflation, persistently high interest rates and continued constraints on the supply side of the residential building market,” he said.
“WA has seen an earlier recovery in the residential building market compared to our eastern counterparts. This is good news, but more must be done to make up the remaining 6000 homes.
“As a share of Australia’s population, WA will need to build around 130,000 new homes over the next five years. We have done this before, and we can do it again.”
In the way of WA’s goals are planning, workforce and productivity challenges, which has seen productivity in its construction industry fall by 18 per cent over the past decade.
Mr Pollock called on the State Government to expedite the rollout of planning reforms and build-ready land to reduce the high costs and time it takes to build.
“The performance of higher density building will be crucial to meeting the target and combating the housing and rental crisis,” he said. “Build times for these projects have blown out since the pandemic by around 20 per cent from approval to completion and costs have risen by around 40 per cent.
“Inflation is a capacity killer. Governments must speed up efforts to address these supply bottlenecks.”
The Master Builders CEO welcomed the state’s “continued support” for commercial and civil infrastructure, which is set to grow by 7.5 per cent and 19.2 per cent respectively over the coming five years.
However, he labelled the other “bottleneck” of workforce shortages as the “biggest challenge for the industry across all sectors”.
“Domestically, we cannot fill this gap,” said Mr Pollock.
“The State Government understand this and recently listened to industry to extend the construction visa subsidy program, but more needs to be done at a federal level, particularly to make it easier for employers to navigate the complex and costly visa system.”
Since this latest forecast, the WA Government has announced extra support for buyers significantly impacted by construction delays in some off-the-plan developments.
A buyer in an off-the-plan development is required to pay transfer duty within three years of their contract date, or earlier if settlement occurs first. In some cases, unforeseen construction delays beyond the control of the buyer and the developer have seen settlement dates extend well beyond the original timeframe.
Due to these barriers, WA’s Commissioner of State Revenue is exercising discretion to provide extra time under a payment arrangement for affected buyers to pay their transfer duty.
Finance Minister Sue Ellery said the government understood the difficulties faced by some Western Australians due to construction delays on apartment developments.
“We encourage anyone who believes they may be eligible to contact RevenueWA to discuss their situation.”
