At its current pace of construction, Australia could face a housing shortfall of half a million homes by 2020, the HIA has claimed.

In its Housing to 2020 report, the Housing Industry Association has claimed housing shortfalls could become increasingly critical in the years ahead.

"HIA estimates that Australia will require in the order of 1.6 million homes over the nine years to 2020, but if we build at the average rate of the last 20 years many areas of the country will have a critical housing shortage by 2020.

Under such a scenario the cumulative national shortage could approach 500,900 dwellings," HIA senior economist Andrew Harvey said.

The organisation has forecast that NSW will see the greatest shortfall of dwellings, with a housing deficit of 155,700 by 2020. Tasmania was the only state or territory where the HIA projected a surplus by 2020.

In spite of the HIA claims of a housing shortage, recent data suggests an overhang of housing stock currently on the market.

RP Data has indicated stock levels are 32% higher across capital cities than at the same time last year, and SQM Research has pointed to a 22% year-on-year increase in stock on market nationally.