Building costs are continuing to rise, putting further pressure on the housing supply.

The costs of building a home increased a further 1% in the third quarter of 2024, according to CoreLogic’s Cordell Construction Cost Index (CCCI). That 1% increase can add thousands to the cost of building a home.

CoreLogic economist Kaytlin Ezzy says the number of dwellings completed in the 12 months to June was not enough to meet Australia’s housing targets. In the year to June, 176,000 dwellings were completed, 26.6% below the 240,000 annually needed to fulfil the target. “While 250,000 homes remain within the construction pipeline nationally, the sluggish flow of new dwelling approvals suggests a shortfall of projects once the backlog is worked through,” Ezzy says.

The Business Council is calling for a major overhaul of Australia’s housing approval processes to boost supply. It is calling for state-wide council report cards so that the performance of Council approvals, particularly the time it takes for approvals to go through, can be monitored. It wants State governments to be able to remove the planning authority of councils which continually underperform in timely approvals, and it was to elevate housing projects of significance to state governments for approval.