Which State Is Falling Behind Australian Housing Target?

Source: Australian Bureau of Statistics (ABS) data and analysis from the Australian Financial Review, October 2025.

Australia’s plan to build 1.2 million new homes in five years is already off track — with major differences emerging between states.

New ABS figures show that no state reached 20% of its first-year goal, leaving a shortfall of about 66,000 homes across the country.

National Performance Snapshot

ACT, Victoria and Western Australia are leading progress, completing around 18–19% of their first-year targets.

Meanwhile, New South Wales, Tasmania and the Northern Territory are lagging far behind, achieving only 5–11%. NSW faces the biggest task, accounting for over 30% of Australia’s total target, yet reaching just 11.3% so far.

Analysts point to slow approvals, limited high-density construction, and labour shortages as key reasons behind the uneven results. States that allow higher-density projects, such as Canberra and Melbourne, are tracking better than those constrained by planning complexity.

Insight

This uneven performance reveals a deeper issue: Australia’s housing supply simply isn’t keeping up with demand.

Without faster approvals and a stronger construction workforce, the gap will continue to grow — pushing prices and rents higher through 2026.

Looking Ahead

Australia’s housing challenge is deepening — and the shortage of new homes will continue to drive long-term growth in established and off-plan markets.

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