Lack of supply is leading to the Great Australian Dwelling Drought

We’ve been talking about the supply issue in Australia for YEARS, and to be honest it’s starting to get a little embarrassing.

We’ve had what feels like endless headlines and political promises to build more houses, and yet we’re STILL not building anywhere near enough. In fact, according to the Australian Bureau of Statistics, building approvals for new dwellings are still at decade lows – with only 15,220 dwellings approved in March 2025. It may sound like a lot, but when you consider that this is for the WHOLE of Australia (plus, not to mention our population is BOOMING), this is actually a significant drop from previous years (-8.8%).

To add to this, trusted and well respected property analyst and researcher Michael Matusik referred to the embarrassing state our housing supply is in, with this table (shown below) highlighting that Australia is far below the OECD average for homes per 1000 residents

And we agree with him – the red tape that we have places far too many barriers on solving the supply and demand issue we have here in Australia.

So what’s actually happening – why aren’t we building enough?

1. Red tape and planning delays:

   The complex planning processes and crazy amount of regulations we have in Australia means it can be incredibly hard to even get approvals for the construction of new houses.

2. Shortage of labour and materials:

   The construction industry has been facing some huge challenges for a while now in terms of not having enough skilled labourers, building materials being increasingly hard to source and also costing a heap.

3. Rising construction costs:

   Rising costs have been putting pressure on the bottom lines of projects, and this has led to a lot of projects either being delayed or just cancelled altogether.

It’s clear that something needs to change here in Australia. There are too many barriers to entry when it comes to building new homes, which is exactly why we fell short by over 68,000 homes of our annual target of 240,000 in 2024 – and this is only set to worsen.

The thing is too – demand is only going up. From population growth across the country to falling interest rates and even to government incentives aimed at first home buyers and investors, more and more people are looking to enter the housing market. The problem is, we just don’t have enough houses to service the demand.

So what can you do as a property investor?

There’s no denying that this type of environment can be challenging for investors, however, it does provide a unique opportunity to kill two birds with one stone. If you can do it right, investing while the supply and demand crisis is at its peak could actually provide you both with the wealth-building perks that service you personally, and the potential to make a positive impact to the wider Australian population.

1. CREATE the supply yourself:

   By taking matters into your own hands and developing new dwellings or renovating existing properties, you can add much-needed housing stock to the market and reap the rewards of the high demand state we’re currently in too.

2. Add value:

   If you’re able to improve the quality of current properties, you’ll not only increase their value but provide more value and better housing options for potential tenants.

3. Provide rental housing:

   The rental market is skyrocketing because of this supply and demand issue. So, if you can provide the housing through quality investments, you’ll reap some great cash-flow rewards.

4. Rinse and repeat:

   If you hit all of the above points while property values are rising, over time you’ll be able to use the equity in your properties to fund more investments – building your wealth while further increasing housing supply.

Sure, investing is about building wealth. Absolutely it’s about creating a secure future for yourself and your loved ones. But the great thing about investing right now is that you’re ALSO solving a real, nation-wide problem by providing quality housing for people that need it.

And that, friends, is the power of being a strategic investor.

So if you’re ready to start your journey or want to find out about the best ways to expand your portfolio in a market like this one, reach out here or give us a call on 1300 776 735 and we’ll be happy to help you out.

We do this day in and day out, so matter what the market looks like or what the country is going through at the moment in terms of the supply and demand crisis – we’ve got you covered!