Advisory Center for Affordable Settlements & Housing

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Document Type General
Publish Date 22/08/2012
Author
Published By Reserve bank of Australia
Edited By Tabassum Rahmani
Uncategorized

Supply-side Issues in the Housing Sector in Australia

Housing demand fundamentals were strong over much of the past decade, underpinned by a high rate of population growth, relatively low unemployment rates, and a strong growth in household income. At the same time, however, the number of new residential dwellings built relative to the size of the Australian population declined, although there was considerable variation between the states. The new development is for free-standing homes on greenfield sites. Infill developments include large medium-density developments (primarily former industrial, or ‘brownfield’, sites) as well as low-rise medium-density developments (less than four stories) and single homes that are usually built by small and medium-sized developers. Supply-side factors can affect the responsiveness of new dwelling construction to changes in housing demand. Recent reports and liaison with industry participants point to a range of supply-side rigidities in the Australian housing market, including the length and complexity of the planning process, issues related to the provision and funding of infrastructure, land ownership and geographical constraints, and other challenges related to infill development. In recognition of this, governments have made some progress in addressing these concerns.

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