Australia’s housing shortage cannot be addressed without nationwide reform to planning and environmental approval systems, with UDIA National calling for stronger incentives to fast-track development and combat ongoing supply chain disruptions.
“We have a housing supply crisis that is being made worse daily by the supply chain shocks, and more homes simply cannot be built without streamlined planning and environmental approvals,” said UDIA National President, Oscar Stanley.
The UDIA National Housing Pipeline revealed that 40 per cent of all zoned land earmarked for new housing is currently constrained by environmental or infrastructure issues. Of that, 28 per cent is delayed specifically by environmental approvals, with 17 per cent requiring additional federal sign-off. Further compounding delays, 43 per cent of environmentally constrained projects are held up by environmental offset requirements.
Approval timeframes remain a critical bottleneck across the country. Housing developments typically take between 18 months and up to five years to receive approval, depending on the state or territory, while large-scale master planned communities can spend seven to 10 years navigating the convoluted approvals process.
By the time the market identifies a supply gap, it can take at least 18 months before new projects begin to address the shortfall, significantly undermining the ability to innovate and deliver housing at scale.
“It is clear that government efforts to address the Housing Accord 380,000 home shortfall are being seriously undermined by planning and environmental processes,” Mr Stanley added.
At the same time, supply chain shocks – particularly rising fuel costs – are adding up to the cost of building a home. While recent Federal Government initiatives to boost housing supply are welcomed, there is an urgent need to expand these efforts and focus on practical, low-cost solutions to unlock stalled projects.
To accelerate progress, UDIA National recommends that the Federal Government use the $3 billion Housing Accord Bonus as an incentive for states and territories to halve planning and environmental approval times.
In parallel, the Federal Government should expedite the work of the EPBC Housing Taskforce to improve environmental approval processes and unlock tens of thousands of homes currently stalled within the system.
This reform work is critical to informing broader changes to environmental legislation, ensuring a more predictable and streamlined decision-making framework that balances timely housing delivery with environmental safeguards.
“The quickest and most cost-effective way to increase housing supply is to prioritise faster approvals. Even unlocking 10 per cent of housing currently held up in the approvals system would deliver an extraordinary supply boost and economic benefit, without additional federal spending,” Mr Stanley said.