Masterbuilders urge governments to unlock land, up housing spend to ease rental crisis

A surge in migration and a shortage of tradies has put even more pressure on the housing market according to Australia’s building sector as it outlines its proposed solution to our rental crisis.

A surge in temporary migration is putting increased pressure on already tight rental markets across Australia.

Releasing more land, more incentives for states to build new homes and doubling the spend on affordable housing would help Australia’s rental crisis, according to the building sector as a surge in migration and a shortage of tradies puts even more pressure on the housing market.

Masterbuilders Australia has warned fixing supply issues in the housing market would do more to help renters than a freeze or cap on rents, in its submission to a new inquiry into Australia’s worsening rental crisis.

This would also assist with pressure on the demand side fuelled by record migration levels, with 131,640 international students arriving into Australia in July alone — double the number at the same time in 2022 — according to new figures from the Australian Bureau of Statistics.

Masterbuilders has warned supply side challenges are crippling the rent market and “trapping” would-be first home buyers in a cycle of renting.

“Rising interest rates, high inflation, a surge in migration and woeful building approvals can all impact the housing market,” the submission said.

Australian rental inflation has soared to 14 per cent.

“Lack of supply, particular among higher-density homes which is relied upon by renters, is putting more pressure on the rental market with rental inflation hitting its highest rate in 14 years.”

New home building approvals in June about 15.5 per cent down on a year earlier.

House vacancy levels in Sydney are languishing at about 1.5 per cent, in Melbourne the rate is 2.2 per cent and in Brisbane just one per cent, meaning competition for both renting and buying is fierce.

Among a raft of recommendations put forward by the sector is for governments to produce an inventory of the land they hold and its suitability for housing, release more of that land and to commit to spending at least one per cent of developer taxes and charges back into building social and affordable homes.

Masterbuilders has also called for Labor to double the size of its signature Housing Australia Future Fund (HAFF) to $20 billion to increase the amount of social and affordable homes the government was funding, which then takes pressure off demand in the private rental market.

Meanwhile the boss of Australia’s largest brickmaker has warned a severe shortage of key tradies such as bricklayers and plumbers is adding to supply chain woes in the building sector.

Brickworks chief executive Lindsay Partridge said priority needed to be made to encourage tradesmen to migrate to Australia to build homes and alleviate the housing crisis.

“The one issue that the federal government has got control over, that’s immigration, and they’ve got to (bring) tradespeople here,” he said.

“There is no use (bringing in) nurses or doctors or anybody else because they have got nowhere to live.”

Originally published as Masterbuilders urge governments to unlock land, up housing spend to ease rental crisis