Australia’s Housing Shortage: Still a Buyer’s Window

New building figures are landing this week, and they’re telling a story I’ve been watching closely for months: Australia’s housing shortage isn’t going away anytime soon.

Here’s the number that stood out to me. The country needs around 240,000 new homes a year just to hit the national 1.2 million homes target. Last year, we built about 173,000. That’s a gap of nearly 70,000 homes, and some industry economists reckon the real number we need is closer to 250,000 a year once you factor in shrinking household sizes and the backlog we’re already carrying.

So yes, construction is picking up. After improving in the December quarter, new home starts fell again in the March 2026 quarter. ABS data shows total dwelling commencements fell 11.2% to 48,012 dwellings, and building times have sped up too, about 10% faster than when the National Housing Accord kicked off. That’s genuine progress. But “faster” isn’t the same as “enough.” And that gap between supply and demand is exactly why I keep telling my clients not to wait for the perfect moment. In a market like this, the perfect moment tends to arrive after the good opportunities are already gone.

Why this matters if you’re buying

When new homes can’t keep pace with population growth, well-located, established properties hold their value. Scarcity works in a homeowner’s favour over the long run, even when headlines get noisy about rates or costs. That’s the fundamental I keep coming back to with clients: focus less on this week’s news cycle, more on where supply is genuinely tight, and demand isn’t going anywhere.

There’s also a rare story unfolding. The Reserve Bank’s chief economist is speaking this week, and her comments could shape expectations on where interest rates head next. If conditions ease even slightly, buyer confidence tends to follow, and competition in undersupplied areas can pick up fast. I’d rather my clients be positioned before that happens, not scrambling once it does.

What I’d suggest

If you’re weighing up a purchase, this is a good moment to get clear on your numbers, your target areas, and your timeline, rather than waiting on the market to “settle.” Markets built on genuine supply shortages rarely settle in the buyer’s favour. I’ve written more about how this shortage has been building over the past year on our blog, including what it’s meant for first-home buyers and interstate investors alike.

If you’d like a second set of eyes on your strategy, that’s exactly how we work with clients at D’MANSHA, from narrowing down the right suburbs to our full acquisition process. You can also run your own numbers first using our property calculators. 

Thinking about buying in this market and want it done properly? Give me a call on 0406 11 22 44, or book a free, no-pressure consultation and let’s map out your next move together.