One year on: National Housing Accord struggles to meet ambitious targets

The Housing Industry Association (HIA) has marked the first anniversary of the National Housing Accord, a landmark commitment to build 1.2 million homes, with a mixed review of its progress. While the Accord was initially lauded as a significant step towards addressing Australia’s housing supply issues, the HIA has expressed concerns over the lack of tangible outcomes in the past year.

Jocelyn Martin, Managing Director of the HIA, acknowledged the intent and cooperation symbolised by the Accord but highlighted the need for more substantial progress. “We welcome the intent and cooperation the Accord represents, but it must be said that meaningful progress on the ground is yet to materialise,” she stated.

The National Housing Accord was introduced with the vision of a unified national approach to housing supply, a move initially welcomed by the HIA. However, Martin pointed out that despite the right conversations and funding announcements, the actual number of new housing starts is not meeting the growing demand. “When the Accord was announced, HIA welcomed the vision of a unified national approach to housing supply. A year later, we are seeing the right conversations taking place and funding announcements made, but new housing starts aren’t keeping up with demand,” Martin explained.

The statistics underscore Martin’s concerns. In 2024, there were only 168,050 dwelling commencements nationally. If this trend continues, Australia will fall significantly short of the 1.2 million homes target set by the Accord. The HIA’s forecast of dwelling commencements, or gross new housing supply, predicts that only around 986,000 homes will be delivered to the market over the five years to 2028/29.

Martin identified several persistent challenges that continue to hinder the building industry. “Builders are still facing the same barriers that have been holding the industry back for years. Land supply remains constrained, planning systems are slow and complex, and the cost of delivering a new home continues to rise because of charges, taxes and red tape. Interest rates, skill shortages and material costs only add to these pressures,” she said.

In a positive development, the HIA has welcomed a renewed focus on productivity in residential construction from the Minister for Housing, Clare O’Neil. Martin noted, “It appears to be finally registering with the Government that we need to address red tape brought about by archaic approaches to planning and building codes, we need ways to improve workforce participation and to encourage innovation, and we need to address the barriers to foreign investment which are holding back apartment supply.”

Despite these acknowledgments, Martin emphasised that governments at all levels need to move beyond mere commitments and focus on delivering reforms that will lead to more homes being built. “However, governments at all levels need to move beyond commitments and deliver the reforms that will actually get more homes built,” she urged.

The ambitious goal of building 1.2 million houses is seen as a crucial target, albeit a challenging one. Martin stressed the importance of striving towards this objective, stating, “The goal of 1.2 million houses is an important one. It is true that it is going to be a tough ask to reach the target, but we must try.”

The Accord has laid the groundwork for collaboration between state, territory, and the Federal Government on housing issues. However, Martin insists that the next 12 months must focus on removing the barriers that prevent homes from being built. “The Accord has provided the foundation to bring state, territory and the Federal Government to the table on housing. Australians now need governments to clear the obstacles that prevent homes being built. The next 12 months must be about removing barriers to delivery,” she concluded.

As the National Housing Accord enters its second year, the pressure is on for governments and industry stakeholders to translate their commitments into actionable results. With the housing crisis continuing to affect many Australians, the need for effective solutions has never been more urgent.