The extreme pain being felt in the housing market is set to continue with a whopping 331,000 households already in rental stress.
Australia’s horror housing market is set to continue with extreme pain hitting renters and a shortage in home supply set to drag out for years, an alarming new report has revealed.
It showed that there will be a shortage of 106,000 homes by 2027 across Australia as a result of skyrocketing interest rates, soaring immigration, a lack of building and community opposition to development, according to The National Housing Finance and Investment Corporation (NHFIC).
It forecasts that in Brisbane alone – which is gearing up to host the Olympics in 2032 – there will be a shortfall of 12,300 homes within five years, while Sydney will be lacking more than 10,000 homes. Perth is predicted to record the biggest shortfall of 25,200 dwellings by 2027.
While around 148,500 new dwellings are expected to come on to the market in the 2022-2023 financial year, this will drop to 127,500 in new construction in 2024-2025.
“Over the three years to 2024-25, NHFIC expects an average of 138,100 net new additions to be added to Australia’s housing stock. This is well below the 180,000 average each year forecast in last year’s report for the same period,” the report warned.
It expects just 57,000 homes a year to be built over the next five years, 40 per cent down on levels experienced in the late 2010s. Meanwhile, the Centre for Population predicts net overseas migration to increase by 268,000 between 2022 and 2024, with recent data suggesting this could be considerably higher – adding to the pain already felt in the housing market.
“The rapid return of overseas migration, together with a supply pipeline constrained by decade-high construction costs and significant increases in interest rates, is exacerbating an already tight rental market,” NHFIC CEO Nathan Dal Bon said.
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