Labor needs to 'step up the pace' after housing approvals slump, REA Group senior economist Eleanor Creagh declares
Labor needs to 'step up the pace' to fulfil its ambitious housing target, an economist has warned as the rate of building approvals in Australia recently slumped.
Dwelling approvals fell 5.7 per cent in April, according to the Australian Bureau of Statistics, coming in well below market expectations and causing concern as the nation continues to grapple with a housing shortage.
While the approval trend has been positive over the past year and a half, the recent downturn is a thorn in the side of Labor's plan to deliver 1.2 million new homes by mid-2029.
REA Group senior economist Eleanor Creagh urged for greater action to fulfill the major looming target.
'We're really not approving and then building enough new homes to meet pace with where demand currently is and also to meet the federal government target of a million new homes by 2029,' Ms Creagh said on Sky News' Business Now.
'So, we really need to step up the pace of: one, approvals—which is really the best-case scenario for what gets off the ground; two, building activity—which is hard, given continued labour shortages and higher prices, cost materials, etc.; and then, three, completions.'
The overall decline in April was driven by lower apartment approvals, according to the ABS' head of construction statistics Daniel Rossi.
'A drop in apartment approvals drove a 19 per cent fall in private dwellings excluding houses,' Mr Rossi said.
'Meanwhile, private sector house approvals were up 3.1 per cent.'
This followed a 14.4 per cent drop in March as apartment approval rates have sank compared to the start of the year.
'In original terms, 5,612 apartments were approved across March and April, compared with 8,625 approved across January and February,' the ABS said.
Alongside its pledge to build 1.2 million homes, Labor has also committed $10 billion to build 100,000 homes over eight years for first time buyers.
The Albanese government has also established the First Home Buyers Guarantee to allow first-time buyers to purchase a home with a five per cent deposit and without paying Lenders Mortgage Insurance.
It follows the Reserve Bank of Australia delivering its second cash rate cut of 2025 last week, which is expected to further the turnaround in house price growth after slowing in 2024.
Originally published as Labor needs to 'step up the pace' after housing approvals slump, REA Group senior economist Eleanor Creagh declares
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