Australia needs to maintain its current record-breaking rate of housing construction if it is going to successfully and affordably house it rapidly growing population, according to a new report from the HIA.

The report, titled 'Housing Australia’s Future', presents a number of scenarios for population growth and wages growth, and estimates how many new homes will be required to avoid worsening Australia's housing affordability.

Source: HIA Economics.

“Australia needs to build in more than 230,000 homes every year if we are to address our current housing affordability challenge,” said Tim Reardon, HIA’s Principal Economist.

“Over the past 15 years Australia’s housing market has been dominated by a persistent undersupply of housing," he said. The RBA, the Productivity Commission, and federal and state treasuries acknowledge that undersupply is the key cause of the country's affordability challenges, says Reardon.

“In 2016 Australia built a record number of 230,000 new homes and we will need to maintain this rate of annual supply for the next thirty years, if we are to meet future housing needs," he said.

“Housing affordability will not be solved by amending negative gearing, capital gains tax or imposing punitive charges on foreign investors," said Reardon.

“Meaningful action needs to include all three tiers of government, working with industry, to ensure the delivery of affordable residential housing,” he concluded​.

Click here to download an extract of the HIA's 'Housing Australia's Future' report or to purchase the full report.

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