The mammoth scale of the task the Albanese government faces to meet its target of building 1.2 million new homes by mid-2029 has been laid bare by new official housing figures.
The ABS data shows there was a 27.5% shortfall in the number of homes built in the first full year of the 5-year National Housing Accord, compared to the average build rate needed to keep the ambitious plan on track.
The figures don’t bode well for much improvement in home building over the next year either, showing commencements of new homes falling.
Separate data from the ABS indicates that migration numbers to Australia have also started rising again, despite pledges by the Federal government to taper numbers down after the huge post-pandemic spike.
The details
The latest “Building Activity, Australia” data release from the Bureau of Statistics shows that 40,524 new dwellings were completed in the June quarter of 2025, with declines in completed free-standing houses and in completed apartments and townhouses (the “New other residential” category).
That means that during the full first year of the National Housing Accord (which officially began on the 1st of July 2024), just 174,030 new homes were finished and ready for occupants.
That’s a 27.5% shortfall in Year One on the average number of homes (240,000) needed to be built in each of the 5 years of the Accord.
Independent housing analyst Cameron Kusher says it’s a “terrible outcome”.
“We now know what the first 12 months of the Housing Accord period looks like for dwelling completions and it doesn't look good.
“Not only did dwelling completions fall to 40,524 over the quarter, it was the lowest quarterly completions since the March 2014 quarter,” he says.
“Governments (as things currently are) can't make new dwellings get constructed but they can certainly do a lot more to facilitate new dwelling construction.”
Michael Bleby, the Deputy Property Editor at the Australian Financial Review, points out that the ABS completion figures “reflect housing projects started well before the slew of reforms made by the federal and state governments to accelerate housing delivery.”
These, he says, include “speeding up applications held up by environmental and heritage reviews, zoning changes, efforts to encourage prefabrication and modular construction and a freezing of updates to the National Construction Code.”
Housing commencements
However, the ABS Building Activity data set doesn’t bode well for much improvement in home building over the next year, with seasonally adjusted figures showing that commencements of new homes fell 4.4% in the June quarter of 2025.
“There was a 6.4% decline in detached house starts, which recorded their weakest quarter since March 2024, and higher-density (apartment and townhouse) home commencements declined by 1.7% during the June 2025 quarter,” says Shane Garrett, the Chief Economist at Master Builders Australia.
Mr Garrett has calculated that the shortfall means Australia now needs to deliver an average of 255,300 new homes per year over the remaining four years of the National Housing Accord – a significantly higher bar than before - and one most analysts believe is insurmountable.
“The Housing Accord won't be achieved but this should be a wake-up call to all governments to do more to facilitate new housing supply,” independent housing analyst Cameron Kusher says.
However, as a signatory to the Accord, along with state and federal governments, unions, big building firms and other industry groups, Master Builders is choosing its words carefully.
“We appreciate the work already completed and call on the government to build on this by fast-tracking reforms that cut red tape and boost housing supply,” says Master Builders CEO, Denita Wawn.
“Accelerating approvals, streamlining regulation, addressing skill shortages, and supporting private investment will give industry the certainty to get projects moving.”
The Housing Industry Association, also a signatory to the National Housing Accord, says there has been “substantial policy reform” over the past year, which will “improve the supply of new homes”.
However, Chief Economist Tim Reardon says HIA forecasts “estimate that Australia will fall almost 200,000 homes short by the end of the five-year target period,” releasing the chart below to demonstrate visually just how far from government targets the actual pace of home building in Australia is:
Migration figures
Separate figures from the ABS indicate that permanent migration numbers to Australia have started rising again, despite pledges by the government to taper numbers down - particularly with a crackdown on bogus international students.
With an existing estimated undersupply of 200,000 homes, the relatively high level of permanent migration and long-term arrivals to Australia has become a political lightning rod, with many arguing it is exacerbating the housing crisis.
After a big spike in net overseas migration in 2022-23 of 535,520 and 445,640 in 2023-24, the government forecast that number would fall to 260,000 in 2024-25.
In the mid-year budget update, that forecast was increased to 340,000 - a blow-out of 80,000.
While we are still waiting for the finalised 2024-25 figures, ABS net permanent and long-term arrivals data totaled 31,450 for the month of August 2025, 32% more than the same month last year.
That means for the first eight months of 2025 alone, 379,850 more people arrived permanently in Australia than left, a rise of 6.4% over the same period last year.
While the so-called NPLT figures are a different data set to net overseas migration, they’re generally accepted as a good leading indicator.
As ABC TV Finance commentator Alan Kohler puts it, “I think we can confidently say immigration has stopped declining.”
Given that migrants need somewhere to live, and given the dismal new home construction figures, it seems fair to say that the current housing crisis in Australia looks set to continue indefinitely.