Home building is heading for an apartment-led recovery in 2026, as starts on higher-density homes pick up on the back of lower borrowing costs, higher rents, policies encouraging social housing development and planning changes, Oxford Economics Australia says.

Attached home starts – of apartments, townhouses and semi-detached homes – will surge 80 per cent from their annual rate of 60,728 in the March quarter to 109,573 by June 2029, the consultancy says in its latest forecasts.