The folloing is a media release from the Housing Industry Association:

Housing Shortage Tracking to 500,000 by 2020

The Housing Industry Association, Australia’s largest building industry organisation, today released its inaugural Housing to 2020 report. The report finds that if current building trends persist, then Australia’s cumulated housing shortage would reach 466,000 dwellings by 2020.

HIA Senior Economist, Mr Ben Phillips said that Housing to 2020, which focuses on future housing demand and the number of dwellings required in meeting this demand, highlights a current housing shortage that already numbers over 109,000 dwellings.

“The reality in many regions and cities in Australia is that affordable, well located land is not available or abundant. Furthermore, planning restrictions, higher taxation on new housing relative to existing dwellings, labour shortages, and onerous regulation biased toward new housing all add to the problem.

“If we don’t get a comprehensive supply response to the accumulating housing shortage then the lack of affordable and appropriately located rental properties will only worsen, while pressures on existing home prices will continue at an undesirable rate, placing avoidable upward pressure on interest rates,” Ben Phillips said.

“A lack of skilled labour is an emerging threat to the much needed housing supply response. A second round resources boom this decade will draw heavily on an already tight labour market. The $90 billion worth of resource projects on the books is expected to demand an additional 136,000 direct and indirect jobs. This labour will need to be housed, adding additional pressure to the supply of labour and materials in non-resource regions.”

Housing to 2020 provides the first estimates made of Australia’s housing shortage at a Local Government Area (LGA) level.

“The report finds that shortages exist in just under half (295) of the 669 LGA’s across Australia. The majority of the shortages can be found in and around metropolitan Sydney and Brisbane.

“It was also found that many of the LGA’s with the largest housing shortage are also the same regions with the highest level of demand. Again, it’s the growth areas in the greater Sydney area and in South East Queensland where demand will be amongst the highest in the nation.

“The growth areas in and around Melbourne also show high levels of demand.

“Current construction levels in most high demand areas are simply not sufficient to meet the needs of a fast growing population,” said Ben Phillips.

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The Australian property market has seen a glut in new build properties over the last few years as high interest rates, slow paced property markets and more recently stricter lending policies by the banks, have forced the industry into a dramatic shortage of new properties. This is all about to end according to the Housing Industry of Australia… and its about to end as soon as this year. Recent statistics released by the HIA states that the HIA forecasts the total number of completed homes in Australia will rise from 129,500 in 2009 to 139,200 homes in 2010. According to the HIA there were 141,000 completed homes before the onset of the global recession slowed construction and lending to the sector. Chief Economist of the HIA, Harly Dale says “The effect of the First Home Owners Grant boost, along with 49-year-low interest rates, will cause the housing sector to “grind out” a recovery in the middle of the year”.

Having stated that construction will rise, they still confirm that Australia will have a mass shortage of housing for many years to come. Harley Dale, said “Given the outlook for a modest rather than significant recovery in new home building, the shortfall between dwelling completions and underlying demand will exceed 50,000 dwellings per annum for some years to come.”

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