Housing supply

The 11 regions facing the housing supply crisis in 2023

The crystal ball for 2023 shows no signs of easing Australia’s housing supply crisis, with 11 regions facing a shortage of independent homes.

The latest data from InvestorKit identified 11 regions across the country that would be most affected by a housing shortage, in the short to medium term.

These include: Brisbane Inner (North) and Toowoomba in QLD; Camden, Penrith, Albury-Wodonga and Wagga Wagga in New South Wales; Tuggeranong in ACT; and Prospect-Walkerville, Charles Sturt, Mount Gambier and Onkaparina in South Africa.

InvestorKit’s head of research, Arjun Paliwal, said the solution to Australia’s housing crisis is not as simple as building new homes and hoping the problem resolves.

“A combination of many existing and emerging issues have contributed to the housing supply crisis,” Mr Paliwal said.

“To solve Australia’s housing shortage problem, we need a more even population distribution, a more efficient planning system, a fairer tax system to encourage stock mobility, policies more investor-friendly, a greater diversity of housing providers, etc. take a long time to accomplish.

The nine ingredients that contribute to supply problems

Mr Paliwal identified nine areas contributing to Australia’s housing supply problems.

  1. Net migration fuels rental demand
  2. The average household size is decreasing
  3. Difficulties in unlocking new land reserves
  4. Delay in development approvals
  5. The concentration of the population in the big cities and on the coast
  6. Australians keep their properties longer
  7. Construction delays due to cost and material shortages
  8. Labor shortages
  9. A suppression of investor activity

Although the National Housing Accord, introduced in last month’s federal budget, aims to address housing supply problems, Mr Paliwal believes the plans will not be enough to stem the rent crisis or the housing problem. housing supply.

“An announcement of 10,000 spaces here and there or similar building trends over the past five years is not enough, he said.

“Many don’t understand that we’re going to see around 200,000 inbound migrants with the cap lifted every year and Australia typically sees 450,000 to 550,000 housing transactions a year.”

The 11 regions facing supply constraints in 2023

InvestorKit analyzed over 300 Statistical Area Level 3 (SA3) regions to determine the most affected.

For each of the regions, InvestorKit has provided a Supply Shortage Score (SSS) out of five based on factors such as established supply risk, future supply risk, movement of people, housing availability, rental pressure and pressure on prices.

A higher score means more supply problems.

1. Brisbane Inner (North) – 4.7/5

  • Population growth : increased by 26.1% between 2012 and 2021
  • Total number of listings for sale: dropped by 44% between 2012 and 2021
  • Building permits: last year’s total number was only 0.78% of all homes
  • Current volume of stock on the market: 1.18% compared to the total housing stock in the region
  • Current rental offer: 0.7%

2. Toowoomba – 4.3/5

  • Population growth : increased by 9.8% between 2012 and 2021
  • Total number of listings for sale: fell by 39.3% between 2012 and 2021
  • Building permits: last year’s total number was only 1.71% of all homes
  • Current volume of stock on the market: 0.77% compared to the total housing stock in the region
  • Current rental offer: hovering at an extremely low level in recent years

3.Camden- 4.7/5

  • Population growth : increased by 35.7% between 2012 and 2021
  • Total number of listings for sale: fell by 24.8% between 2012 and 2021
  • Building permits: last year’s total number was only 1.23% of all homes
  • Current volume of stock on the market: 0.83% compared to the total housing stock in the region

4. Penrith – 4.5/5

  • Population growth : increased by 21.9% between 2012 and 2021
  • Total number of listings for sale: only increased by 2.3% between 2012 and 2021
  • Building permits: last year’s total number was only 1.56% of all homes. That’s about half of the 2018 figure
  • Current volume of stock on the market: 0.83% compared to the total housing stock in the region
  • Current rental offer: less than 1% in the last 12 months

5. Albury-Wodonga – 4.4/5

  • Population growth : increased by 6.7% between 2012 and 2021
  • Total number of listings for sale: dropped by 65.9% between 2012 and 2021
  • Current volume of stock on the market: 0.82% compared to the total housing stock in the region
  • Request for sales volumes: decreased by 20.4%

6. Wagga Wagga – 4.3/5

  • Population growth : increased by 5.6% between 2012 and 2021
  • Total number of listings for sale: down 66.9% between 2012 and 2021
  • Building permits: the total number this year was only 1.52% of all homes, which did little to alleviate the housing crisis
  • Current volume of stock on the market: 0.68% compared to the total housing stock in the region

7. Mount Gambier – 4.5/5

  • Population growth : increased by 5.8% between 2012 and 2021
  • Total number of listings for sale: down 31.9% year-on-year
  • Building permits: last year’s total number was just 1.48% of all homes, not enough to ease the city’s supply crisis
  • Current volume of stock on the market: 0.48% compared to the total housing stock in the region
  • Current rental offer: less than 1% in the last two years

8. Prospect-Walkerville – 4.3/5

  • Population growth : increased by 6.1% between 2012 and 2021
  • Total number of listings for sale: only increased by 6% between 2012 and 2021
  • Current volume of stock on the market: 0.78% compared to the total housing stock in the region
  • Real estate price growth: From August 2021 to August 2022, the median house price increased by 44%
  • Current rental offer: 0.6%

9. Charles Sturt – 4.3/5

  • Population growth : increased by 10% between 2012 and 2021
  • Total number of listings for sale: decreased by 40.2% between 2012 and 2021
  • Building permits: with around 600 new construction approvals this year, representing 1.92% of all homes, that’s not enough to ease the tension
  • Current volume of stock on the market: 0.84% ​​compared to the total housing stock in the region
  • Current rental offer: 0.3%

10. Onkaparinga – 4.3/5

  • Population growth : increased by 6.5% between 2012 and 2021
  • Total number of listings for sale: downward trend over the past decade
  • Current volume of stock on the market: 0.64% compared to the total housing stock in the region
  • Current rental offer: 0.2%

11. Tuggeranong – 4.3/5

  • Population growth : increased by 3.9% over the last five years
  • Building permits: the total number this year was only 0.19% of all homes
  • Current volume of stock on the market: 0.46% compared to the total housing stock in the region
  • Current rental offer: 0.5% in the last 12 months

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