Australia’s building and construction industry is calling on the government to remove impediments affecting the nation’s supply of housing.

Mr Peter Jones, Chief Economist of Master Builders Australia revealed, builders have become pessimistic as residential and commercial building-related stimulus spending programs wind down at the same time as the credit squeeze and other regulatory constraints continue to affect business operating conditions.

The sector is hoping the Tax Forum can find a pathway for the removal of impediments that suppress housing supply, force up prices and worsen housing affordability.

“Artificially high barriers to the purchase of new or newly built houses in the form of unchecked and inefficient developer levies are a major issue affecting housing affordability thereby constraining the industry’s ability to meet the housing needs of the population,” Mr Jones said.

“Unless there is urgent reform to address inefficiencies and bottlenecks the strong supply response needed to meet Australia’s housing shortage will not eventuate.”

“Master Builders calls on the Government to work with all stakeholders and facilitate reform of illogical developer charges, improve land release strategies and streamline the approvals process to remove impediments affecting the supply of housing,” he said.

Interest Rate Stability The Key

A strong increase in dwelling approvals in August signals that interest rate stability is beginning to turn sentiment around leading to some improvement in the outlook for the residential building industry, according to Master Builders Australia.

Mr Jones explained the positive result for August was delivered on the back of a big lift in private sector unit approvals, which is a welcome development but "not enough to confirm a sustainable upswing is firmly entrenched given the inherent volatility in monthly apartment approvals.”

According to him, "the much needed upswing in residential building activity is reliant on improved sentiment and less cautious householder behaviour with rate stability helping but with overseas economic uncertainty and share market turbulence working against.”

“The interest rate-sensitive residential building industry is relying on an extended pause in Reserve Bank monetary policy to shore up consumer confidence and encourage an upswing.”