Removing supply constraints to make housing more affordable, a key recommendation of the Productivity Commission Report into the National Housing and Homelessness Agreement (NHHA), has been a constant refrain from Master Builders Australia.

“Master Builders welcomes a key finding from the Productivity Commission that if governments implement reforms to improve supply, to ensure more homes are built, then housing for both homeowners and renters will become more affordable,” Master Builders chief executive Denita Wawn says.

“We know that Australia needs to build at least 200,000 new homes every year to meet demand with it only met once this decade. Alarmingly, Master Builders’ forecasts that the next three years will fall significantly short of that 200,000 per annum figure with the forecasts indicating that it will not be reached until 2026.”

Master Builders advocates that the focus on supply must be across the entire housing market, facilitating movement through the housing spectrum, enabling lower-cost housing to become more affordable. It is clear from the report that the issue of supply should not concentrate on the lower-cost segments.

“We have welcomed the Federal Government’s policy to create a National Housing Supply and Affordability Council to work with all levels of government. Master Builders strongly urges governments to commence work on supply reforms to address the key barriers that include planning restraints, slow land release, high developer charges, and slow approval response times,” Denita adds.

The Productivity Commission found that the $3 billion spent by governments on first home buyer grants works against improving affordability but also found that the main barrier to preventing the purchase of a home is saving for a deposit given that the average deposit required has more than doubled over 20 years.

“Master Builders has supported first home buyers grants as a mechanism to assist in home ownership.  The long-term use of first home buyer grants have been a necessary measure because governments have not addressed the underlying policies that stifle supply that, in turn, make home ownership out of reach for so many,” Denita explains.

Master Builders welcomes the recommendation by the Productivity Commission into the need for an independent review of the construction industry to identify reforms to boost productivity and improve affordability.