NSW builders sound alarm over major eruption – realestate.com.au

NSW’s housebuilding industry has been caught in a Covid time warp – with new homes still taking as long to complete as they did at the height of the pandemic.

This is despite the end of lockdowns, the return of supply chains to normal levels and a slowdown in construction cost inflation.

Shocking new ABS data shows that average home completion times across the state have failed to recover to pre-pandemic levels.

A typical house currently takes more than a year to build, well beyond the nine months it normally took before the pandemic, while construction times for apartment projects have inflated to nearly three years, data shows.

The revelations have prompted warnings from industry leaders that chronic delays are strangling supply and driving up prices.

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Matthew Pollock, director of Master Builders NSW, said NSW has struggled to build new homes at the rate it was building before the pandemic.

“This holds back supply and drives up costs – which is not good for anyone,” he said.

The ABS indicated that the number of NSW homes completed in the first 12 months of the National Housing Agreement was lower than the year before.

As part of the agreement, the NSW Government was tasked with delivering 377,000 new homes across the state by 2029.

Some 42,581 homes were built in the year to June, compared to 46,865 the year before.

Red tape remained a major issue holding back the new offering, Mr Pollock added.

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Unit projects now last an average of three years.

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“Our members must pull traditions from construction sites across the state and hire new office staff to address the increased administrative burden caused by the high level of new and changing regulations and red tape,” he said.

“In every region of the state, they are also experiencing increased regulatory inspections (and) development approvals that in some cases have increased from six to 13 pages.”

Mr. Pollock explained that conflicting interpretation of rules between regulators and local councils and a patchwork of local, state and federal laws and regulations are further putting pressure on the construction process, along with insurance changes.

Mr. Pollock warned that these increasing administrative and regulatory burdens were not only delaying projects, but also driving up prices for families already struggling with housing affordability.

“The longer construction times are reflected in higher prices as higher labor and maintenance costs are incurred by builders and passed on to consumers,” he said.

Homes took an average of nine months to build pre-pandemic. Now they last well over a year.

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Mr Pollock urged governments to take action.

“Making the housing sector more productive again is the solution to speeding up home delivery times and increasing supply,” he said.

“Every government decision should have this as its goal, and we need the Prime Minister to continue his mission to roll out micro-economic measures needed to tackle red tape at the municipal level and to encourage the Federal Government to continue freezing changes to the National Construction Act.”