Housing shortage across Australia28 March 2016 by News Desk
A new study shows the country needs to build a quarter of a million new homes in order to meet demand and fill the ongoing housing shortage.
Australia continues to suffer a housing shortage despite the recent construction boom and an over-supply of homes in cities like Sydney and Melbourne.
The housing shortage across the country has helped to inflate property prices as developers cherry-pick the most profitable locations for new construction. Australia needs to build 250,000 new homes, according to a report by ANZ Research Economic Insight. Fears of a property market collapse due to over-supply are unfounded, the report says.
This ongoing demand for new homes, added to a slowdown in population growth, will re-balance the property market over the next few years, the study says.
Over the past ten years the population of Australia has increased by an average of 360,000 people each year. But only around 145,000 new homes have been built each year, creating a housing shortage.
Despite the recent construction boom in major cities there is still a shortage of housing. Even at the height of the boom in 2015 home building did not keep pace with demand as 220,000 new properties came onto the market.
Now the number of new homes being built is falling. This year around 205,000 new homes will be built. And in 2017 the number is forecast to fall to 198,000.
The trend in construction activity suggests there will still be a shortfall of new homes and that the housing shortage will continue. But a slowdown of the property market, added to the many thousands of new apartments that are due to be completed in next two years will re-balance the market, the report suggests.
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