The Urban Development Institute of Australia’s UDIA Housing Index which was launched today with data for the March Quarter, reveals a ‘perfect storm’ of very high building costs, elevated demand from increased population growth, and historically weak dwelling supply. This has led to a ‘well below average’ level of housing performance, resulting in higher market prices and fewer houses being built.
“The UDIA Housing Index (UHI) was created as an authoritative analysis of the housing market, designed to provide an advance warning of whether the economy is starting to grow or tank,” said Col Dutton, UDIA National President.
Until the UDIA Housing Index, there has been no comprehensive residential market, construction and development analytics that holistically captures the true nature of the nation’s chronic housing crisis. Our Index combines analysis of a range of critical factors to reveal the true health of the housing industry, so that policy responses can be formulated in a timely matter to mitigate the nation’s housing market decline.
“Industry and Government will now have the UDIA Housing index that gets behind the raw numbers to understand all the factors impacting housing demand, supply, costs and market health,” said Mr Dutton.
Key Facts from the March Quarter’s UDIA Housing Index report:
The current residential market dynamics are pushing up housing prices and further eroding housing affordability. The need for ongoing, comprehensive initiatives to bolster new private dwelling supply, has fuelled the crisis in the national rental market with stock availability heading for decade lows.
The UHI analysis reveals there are no signs that pressure is easing in the construction employment sector with job vacancies around twice the long run average. Even with the recent Federal Government announcement of investment and initiatives focused on boosting skilled migration for the construction industry, the diminishing forward supply pipeline and the current inadequate workforce to service current levels of demand, means that the national housing market will remain mired in the current crisis conditions for at least the next two years.
These extremely challenging housing market conditions underscore the need for government authorities across the nation to work closely with the residential development sector.
Together we need to devise the necessary and locally appropriate solutions, to help unlock new dwelling supply faster and increase the overall capacity of the Australian new build housing sector.
The UDIA Housing Index shows that Victorian and NSW housing markets are currently far weaker than the national average. QLD is returning to a stronger level of performance and the WA market shows a UHI result higher than the national average.
About the UDIA Housing Index:
The UDIA Housing Index fills a void in a market that is crying out for quarterly analysis of the health of the industry, state of housing supply and the current trajectory of demand, supply and costs components of the residential sector.
A critical indicator of industry’s capacity to deliver housing across the spectrum is the economic health of development and construction. This includes access to credit, supply and demand drivers, as well as core indicators like skilled labour, rental and
ownership, construction costs, sales and interest rates. The UHI draws on exclusive data provided by our Research Partner CoreLogic, in addition to publicly accessible government released data including the Australian Bureau of Statistics and the Reserve Bank of Australia.
“Industry and Government will be able to rely on the Index and Dashboard to provide data that will cut through the spin to provide the most comprehensive quarterly health check for industry, Government and the agencies who are designing policies that impact the housing market -policies that are vital to enable first home buyers, prospective purchasers and other participants in the housing market to find a home,” said Col Dutton.
The UDIA Housing Index can be found at this link which includes the March Quarter Report.
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Media Enquiries:
Deanna Lane | Director, National Media & Communications | 0416 295 898 |
media@udia.com.au