Regional Australia could see a worsening of housing and rental shortages if home approval rates aren’t increased, the nation’s residential building industry body has warned.
Data collected by the Housing Industry Association (HIA) shows planning approvals for new homes in regional parts of the country are taking longer to get through local councils than ever before, further exacerbating Australia’s ongoing housing crisis.
Outdated planning processes have left new residential approval times exceeding half a year in many areas, with the situation in regional zones set to worsen as more homebuyers are priced out of metro areas.
According to ABS data, more than 28 per cent of Australians now live outside major capital cities, with median home values in combined regional areas increasing by 11.7 per cent over the last 12 months alone.
HIA Executive Director of Planning and Environment Mike Hermon says the planning and approval process in all states and territories is holding regional towns back from solving rental and housing shortages, which could worsen if regional migration continues its current trend.
“Unfortunately, the housing shortages being experienced in capital cities are even worse across nearly every regional town in Australia,” he explained.
“Builders are acutely aware of the massive pent-up demand for new housing; however, planning systems across these areas are buckling under the weight of current approvals, let alone addressing the significant increase of housing that Australia desperately needs.”
While the housing crisis has also ravaged state capitals, several factors have exacerbated regional markets, including access to build-ready land, essential infrastructure investment, and shortages among planning approval staff within local governments.
Last year, the HIA released its National Planning Reform Blueprint, which aimed at addressing some of these challenges. It also aimed to support planning systems in implementing changes to fast-track approvals and address key impediments holding back new housing delivery.
The ten-point National Planning Reform Blueprint saw governments agree to update state, regional, and local strategic plans to reflect housing supply targets, promote medium and high-density housing in well-located areas close to existing public transport connections, amenities and employment and most critically streamline approval pathways.
However, despite being signed in August 2023, Mr Kermon says governments haven’t done enough to implement these fundamental changes.
“HIA was encouraged by Federal, State and Territory governments signing onto a National Planning Reform Blueprint,” he said.
“However, 12 months on from the National Planning Reform Blueprint being issued, homeowners and builders are seeing no meaningful change and instead, the opposite is occurring. House approval timelines continue to take longer and get more complex to obtain.”
New scorecard slams states
The HIA has now developed the annual HIA Scorecard as an in-depth and strategic assessment to track the progress of the housing strategies each state and territory has implemented and reveal key measures of improvement needed.
Each state is given an aggregate score out of five, indicating its ability to accelerate housing delivery and achieve the Accord’s mission, which is to build 1.2 million new homes nationwide by 2030.
Current Scorecard Results
- Queensland 1.5 out of 5
- New South Wales 1.5 out of 5
- Northern Territory 1.5 out of 5
- Victoria 2 out of 5
- Tasmania 2 out of 5
- Australia Capital Territory 2.5 out of 5
- Western Australia 3 out of 5
- South Australia 3 out of 5
Currently, no state has scored higher than three out of five, however, the scorecard also identifies the key areas of improvement needed in order for regions to achieve a higher score.
“HIA has compiled a ‘Planning Scorecard’ to assess the performance of each state and territories current planning systems and their progress in implementing the National Planning Reform Blueprint measures,” Mr Kermon said.
“The HIA Scorecard outlines that every planning system across the country is struggling under the weight of housing demands, and that the time for business-as-usual solutions to planning and zoning issues has passed.
“Instead, we need bold leadership by all tiers of Governments and this needs to not just be focused on major capital cities but address the key issues being faced in regional Australia to enable these regions to grow and flourish.”
