The Housing Industry Association (HIA) has called on the Federal Government to reset housing policy in the 2026-27 Budget, warning Australia’s housing shortage has become a long-term economic challenge.
HIA recently outlined its position in its 2026-27 Pre-Budget Submission, calling for supply-side reforms across taxation, finance, infrastructure, planning, skills and regulation to support the delivery of 1.2 million homes by 2029.
HIA Managing Director, Jocelyn Martin, said ongoing housing undersupply was contributing to inflation, worsening rental conditions and constraining economic growth.
Martin said housing supply was no longer a short-term or cyclical issue, but a broader macroeconomic problem that required coordinated policy reform.
“Housing is already one of the most heavily taxed sectors in the economy. Further changes to settings such as negative gearing or capital gains tax could undermine investment and worsen affordability,” Martin said.
“HIA is also calling for a review of cumulative macroprudential lending settings, which are restricting access for first home buyers and adding pressure to rental markets without addressing supply constraints.”
To support stalled apartment developments, HIA has proposed a national program to expand state-based pre-sale finance guarantee schemes. The association said many projects were ready to proceed but remained delayed due to financing barriers.
HIA estimates that up to $5 billion in additional funding may be required for enabling infrastructure to accelerate housing delivery and make developments construction-ready sooner.
Martin said workforce shortages remained a major barrier to increasing supply, calling for ongoing employer apprentice incentives, funding for pre-apprenticeship programs, targeted skilled migration pathways and improved skills recognition processes.
“Housing targets will not be met without expanding the construction workforce and addressing long-term skills shortages.”
HIA has also urged the Federal Government to reduce regulatory burden by moving the National Construction Code to a five-year amendment cycle, providing free access to Australian Standards and reducing compliance costs associated with new housing construction.
Ms Martin said the 2026-27 Budget would be a key indicator of whether housing supply was being treated as a national priority, with a focus needed on coordinated reforms that support increased construction.
