Building approvals miss target as rate and price fears grow
208,318 homes were approved in the year to September, below the 240,000 annual rate needed to reach Labor's 1.2 million home target.
Australia's housing crisis is deepening. Building approvals fell short of Labor's National Housing Accord target in the year to September, with only 208,318 homes approved, well below the 240,000 needed each year to build 1.2 million homes over five years.
Building approvals mark the first annual contraction since January. Property developers and economists warn that further interest rate rises and sharp house price falls will make the shortfall worse.
Westpac economist Luka Belobrajdic said rate increases and falling home values are a bad sign for the sector. Tom Forrest, chief executive of Urban Taskforce, said the impact of recent rate rises and Labor's changes to negative gearing tax breaks have yet to fully flow through the data, which reflects sentiment from September to November 2025.
- 208,318
- Homes approved year to Sept
- 240,000
- Annual target needed
- 1.2 million homes
- Five-year government goal
- Four
- RBA rate hikes this year
Why it mattersFewer building approvals now means fewer homes completed later, worsening the shortage of homes for renters and first-time buyers.
AustraliaAustralians searching for homes face a deepening shortage as housing supply lags demand, keeping prices high and rents rising.
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