- An estimated total of 10,000 apartments have been delayed
- Material shortage contributes to the crippled pipeline
- The Property Council has released a new report on housing in WA
More than a third of Perth’s approved apartment building projects have been forced to be put on hold as Western Australia’s skills shortage continues to cripple the construction sector.
An estimated total of 10,000 apartments have been delayed in preapproval and post-approval stages, according to a new Property Council report, Delivering Housing Supply and Affordability for Western Australians.
With much needed housing supply stalled, the Property Council report indicates that price escalations may follow.
Property Council WA Executive Director, Sandra Brewer, has highlighted concerns that more people may become at risk of homelessness.
“Swift action is required to avert a future housing and affordability crisis,” she said.
“As housing becomes more expensive, people move down the property ladder, escalating demand for social housing and puts more people at risk of homelessness.”
“Despite positive policy announcements during the pandemic, like the WA Building Bonus and stamp duty rebates for apartments sold off-the-plan, years of undersupply and underinvestment have put pressure on house prices,” Ms Brewer said.
In a classic case of demand and supply, inadequate housing supply causes price growth. But the Property Council report warns that historically, price growth does not necessarily subside when sufficient supply becomes available.
While skills shortages are a prominent hindrance, building material shortages and heightened cost of production have also contributed to the crippled pipeline.
Ms Brewer underscored the need for a multifaceted approach to address housing supply.
“We know housing affordability is influenced by many interrelated factors that cannot be addressed in isolation,”
“Periods of rapid economic growth have shown us that fixing housing affordability requires policy focused on workers first – because, without workers, property markets cannot deliver the homes people need,” Ms Brewer concluded.
The Property Council’s report argues that the long-term solution is policies supporting housing supply and providing diverse housing choices.
The report recommends policies that prioritise population growth, address barriers to investment, and stimulate build-to-rent. These are amoung the 15 specific policy recommendations are outlined in the report.
The silver lining
While skills and labour shortages are detrimental to the housing supply, the flip side is sky-high job vacancies.
Bjorn Jarvis, head of Labour Statistics at the ABS has explained that job vacancies have continued to reach new record highs through the pandemic.
“Job vacancies were also elevated in all states and territories, ranging between Western Australia, where job vacancies were 120 per cent higher than before the pandemic, and 49 per cent in the Australian Capital Territory,” he said.