Number of newly completed homes in Victoria dropped below last year’s figures

New data shows the state is trending in the wrong direction on new builds despite the Allan government’s bold plan to build 800,000 homes over the next decade.

The number of new homes being completed in Victoria is going backwards, despite the Allan government’s insistence that 800,000 homes will be built over the next decade.

Alarming new statistics show the number of newly completed homes in Victoria has dropped below last year’s figures, with Australia’s peak property body warning that we are “trending in the wrong ­direction”.

According to new seasonally adjusted Australian Bureau of Statistics data released on Wednesday, just 55,653 homes were completed over the past 12 months – 2698 less than the same time last year.

In the March quarter, 14,304 dwellings were delivered in Victoria, compared to 15,041 in the same quarter last year.

Australia’s peak property body says Victoria is trending in the wrong ­direction. Picture: iStock

The dire numbers come ­almost a year on from the delivery of the Allan government’s housing statement, which included a plan to ­deliver 80,000 homes per year over the next decade.

Property Council of Australia Victorian executive Cath Evans said the new data showed Victoria was “trending in the wrong direction” and reflected the government’s refusal to strip back its crippling tax burden on the sector.

“It’s clear from the ABS data released today that Victoria is not yet close to building enough new homes to meet current demand, let alone ­address the cumulative shortfall of homes caused by decades of undersupply in the face of strong population growth,” she said.

It comes just two weeks after the Herald Sun revealed confidence in the Victorian property industry had plunged to the lowest level in the country.

The Allan government’s housing statement includes a plan to ­deliver 80,000 homes per year over the next decade. Picture: Valeriu Campan

And just two months after the Victorian Civil and Administrative Tribunal (VCAT) ruled the centrepiece housing policy held no power to defend proposals for new residential developments.

Despite the government’s claims that it was “pulling every lever” to generate more housing, Ms Evans said residential developers were finding it “increasingly difficult to secure investment to get new homes out of the ground”.

“The tax burden and cost of construction in Victoria is having a remarkably negative ­effect on the financial feasibility of new housing projects,” she said.

The property sector boss said while there had been positive discussions about reforms since the housing statement was released in September, “no action has yet been flagged to address the tax crunch”.

The government claims it is ‘pulling every lever’ to generate more housing. Picture: iStock

“It is imperative that the government acts urgently to inject investment confidence into the industry by delivering positive incentives and alleviating the tax burden,” she said.

Shadow planning minister James Newbury said the data proved the state government’s “damaging housing policy” was hurting the property sector.

“Jacinta Allan needs to drastically scale back her harmful property tax agenda,” he said.

A government spokesman said workforce shortages and supply chain issues had created house-building challenges across the country.

“Victoria continues to lead the nation when it comes to new-home completions – a third more than NSW and double the number of Queensland,” he said.