A rise in cost of living not seen since the 90s has Master Builders Australia (MBA) calling for action on inflation.
The cost of buying a brand new home rose by 17.9 per cent between January – November 2022 according to MBA.
With inflation going up 7.3 per cent during November 2022 (its fastest pace since 1990), MBA CEO Denita Wawn said more needed to be done to tackle supply bottlenecks related to material, labour and housing supply.
“We acknowledge that the RBA has a difficult balancing approach to take in curbing inflation but at the same time not getting too ahead of the realised impact of their decisions,” she said.
“However, the most sustainable solution to the inflationary problem lies on the supply side, through bringing down the cost of doing business. This requires issues like labour shortages, material costs and the regulatory burden to be dealt with in a focusses and urgent manner.
“Housing continues to be the inflationary canary in the coal mine with figures reflecting huge increases in the cost of building materials, as well as continues shortages of key construction trade workers.”
Another area in the housing market – rental rates experienced another sharp rise in 2021, accelerating as much as 3.6 per cent.
“Growing pressures in the rental market are being exacerbated by persistently low building volumes in the higher density part of the housing market,” Denita said.
“Labour shortages can best be addressed over the short and medium term by making it easier for migrants to work in Australia.
“The bottlenecks in our migration system need to be addressed as a matter of priority.”