The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
Australia is grappling with an increasingly severe housing crisis as rising interest rates and skyrocketing construction costs stifle the supply of new homes.
Experts fear that the national goal of constructing 1.2 million new homes over the next five years will remain out of reach.
Issues such as high construction costs have accelerated the cost of building in major cities at a rate that outpaces property price growth. It increasingly appears more financially sound to purchase an existing home rather than build a new one.
According to Tim Lawless, CoreLogic's research director, "the cost of construction is yet to decline and it remains approximately 30% more expensive to build or renovate now compared to pre-COVID times," reflecting a prolonged period of inflating expenses.
SQM Research's founder and managing director, Louis Christopher, has expressed concern. He pointed out that "indicators show no signs of an imminent increase in housing supply," and has projected that there will be only "138,000 new dwellings completed by FY25."
PropTrack's executive manager for economic research, Cameron Kusher, noted, "Building approvals have plunged to their lowest in a decade. The pandemic-induced rise in construction costs, labour shortages, and 12-year high interest rates have severely impacted new constructions."
Adding to the discourse, Ben Burston, chief economist at Knight Frank, warned that "restoring high levels of housing construction will be a laborious task" due to the steep increments in both construction and financing costs.
The Australian Bureau of Statistics (ABS) revealed that only 163,800 homes were approved for construction in the year up to May. This is 32% (or 76,200 homes) short of the Albanese government’s 240,000 annual housing target.
It is crucial to note that the Albanese government’s target of 240,000 homes annually is unprecedented. The closest the nation came to meeting such a goal was in 2017 when 223,600 homes were built, which was still 7% below the target. This was achieved with a cash rate of 1.5%, compared to the current rate of 4.35%.
Back in 2017, builders also faced lower construction costs (some 40% less than today) and did not compete for labour with state government infrastructure projects. In comparison, data from the Australian Securities and Investments Commission (ASIC) show that nearly 3,000 construction firms went bankrupt in the 2023-2024 financial year, reducing the sector’s productive capacity.
Given these macroeconomic conditions, it seems highly improbable for the Albanese government’s housing targets to be met, and dwelling completion rates are likely to remain low in the near term.
Ultimately, a long-term resolution to Australia’s housing shortage may necessitate reducing net overseas migration, hence easing the population demand below the nation’s housing and infrastructure supply capacity.
If these structural issues aren't addressed, Australia's housing crisis is poised to exacerbate.
Commonwealth Bank of Australia (CBA), the nation's largest bank by market value, has reported a modest increase in its first-quarter cash profit for 2025. This uptick is primarily attributed to robust growth in home loans and household deposits. The unaudited cash profit stands at approximately A$2.6 billion, marking a 1% rise from the previous two-quarter average and a 2% increase compared to the same period last year. - read more
Australia's leading banks-Commonwealth Bank of Australia (CBA), Westpac, National Australia Bank (NAB), and ANZ-are actively reducing their dependence on mortgage brokers. This strategic shift aims to bolster profit margins that have been under pressure due to lower interest rates, rising operational costs, and intense market competition. - read more
In November 2025, Australian consumer sentiment has turned optimistic for the first time since early 2022, marking a significant shift in public economic perception. The Westpac-Melbourne Institute survey indicates a 12.8% increase in the consumer sentiment index, reaching 103.8. A reading above 100 suggests that more consumers are optimistic than pessimistic. - read more
The Australian Securities and Investments Commission (ASIC) has recently conducted a comprehensive review of the nation's motor vehicle finance sector, uncovering significant issues that raise concerns about consumer protection and lending practices. - read more
As Australians grapple with escalating living expenses, a notable shift is occurring in the automotive market. Consumers are increasingly turning to premium used vehicles as a cost-effective alternative to new car purchases. - read more
Choosing the right commercial vehicle loan is a pivotal decision for any business aspiring to expand its transportation capabilities. For many, commercial vehicles are integral to daily operations, and securing the best financial arrangement to acquire these assets can significantly impact the bottom line. - read more
Expanding your truck fleet is a critical step in driving business growth. For many small businesses, increasing the number of commercial vehicles means accessing new markets, delivering goods more efficiently, and ultimately, boosting profitability. In the competitive Australian market, staying ahead requires not just maintaining but expanding your transport capabilities. - read more
Maintaining your truck is essential if you want to prolong its lifespan and save money down the road. Australian conditions can put a lot of strain on your vehicle, and neglecting its maintenance can lead to costly breakdowns and repairs. - read more
When purchasing a truck, whether for personal use or business, navigating the financial landscape can be daunting. This is where pre-approval comes into play. But what exactly does pre-approval mean in the context of buying a truck? - read more
Finding the right financing for a commercial vehicle in Australia can be a critical step for businesses and individuals alike. Whether it's for a single van or an entire fleet of trucks, understanding the intricacies of commercial vehicle loans is key to securing a deal that aligns with your financial goals. One factor that stands out in determining your loan terms is the credit score—a numerical representation of your creditworthiness. - read more
Start Here
Get a free truck loan eligibility assessment and compare truck finance and leasing options
without accessing your credit file!!
Knowledgebase
Monetary Policy: The actions of a central bank or other regulatory authority that determine the size and rate of growth of the money supply.
