Private investment key to growing NT housing supplies

The NT remains wildly off-track to reach government-imposed housing targets, with calls for an ambitious plan and policy rethink to reach success.

New dwelling starts in the Northern Territory will remain at historically low levels despite an expected surge in construction in coming years.

The Master Builders NT forecast report shows the Territory’s housing construction remains at critically low levels and well below the highs of the previous decade.

There were almost 630 new dwelling commencements in 2022-23 – an almost 20 per cent increase on the previous year but more than 1000 homes below the historic housing construction highs of the previous decade.

The figures showed the NT government’s target to build 11,000 new homes in the Territory by 2030 were highly aspirational.

Territory residential construction is at historically low levels.

The Master Builders forecast showed ongoing low levels of unit and apartment construction in the Territory.

The figures showed there were 909 new dwelling starts in 2020-21, which fell a staggering 42.1 per cent in 2021-22 when there was just 526 dwelling starts.

There were 628 new starts in 2022-23 and 626 forecast to commence in 2023-24.

While new start numbers will increase in the second-half of the decade, they will still be hundreds below the housing boom that accompanied the Inpex project construction.

Master Builders NT chief executive Ben Carter said there would be some improvement in new home building across the NT in coming years due to lower interest rates, increase in investor demand driven by severe rental market pressures and government commitments around social housing.

Dwelling commencements Darwin 2023

But the improvements will remain way below historical highs achieved as Darwin was preparing for Inpex’ Ichthys LNG development at Middle Arm.

Mr Carter said when compared with the scale reached during the first half of the 2010s until 2014, the Territory’s housing market remains extremely weak, as it has been for nearly a decade.

The 2022-23 financial year is estimated to have recorded about 630 new dwelling commencements in the NT.

While this represents a 19.4 per cent increase on the previous year, it compares with an average of about 1900 new home starts per year between 2010-and 2014.

“Even with the more optimistic outlook for housing that is being forecast for the next four years, there is no way that the NT government’s target of 11,000 homes over five years is going to be achieved unless bold action is taken to unlock private investment,” Mr Carter said.

“Ambition is to be applauded because it drives the achievement of positive outcomes, but according to our latest forecasts the government is not going to get even halfway to its target of 11,000 new homes by 2029-30.

Master Builders NT chief executive Ben Carter

“The government needs a housing plan that is as ambitious as its housing target.

“That plan needs to unlock the power of private investment because the forecasts make clear that the government simply can’t solve the problem on its own.

“While publicly funded social housing has an important place in the housing mix, it is homeowners and investors who have always driven increases in housing supply.

“The government is going to have to think outside its comfort-zone and adopt bold policies that are market driven and in place for the medium term.

“Boosting investment requires confidence, economic growth and certainty.”

Included in the 11,000 homes planned for construction by 2030, the NT government has also committed to build 2000 new public houses from Commonwealth funding.

The NT government is currently believed to be in negotiations with Darwin’s Ostojic Group around development of the Holtze subdivision.