A dysfunctional planning system and huge labour shortage will cripple the Albanese government’s target of 1.2 million new homes in the next five years, despite billions of dollars of public funding pouring into the sector, warn senior property industry figures.

Nigel Satterley, the prominent West Australian developer, said only half of those homes would be finished – between 600,000 and 650,000, “if we’re lucky” – because of a lack of workers to build them.