More Homes, Growing Demand: What’s Ahead for New Builds?

There’s never a shortage of opinions on property. If opinions built houses, we’d have the housing shortage sorted by now.

This week’s figures offer some encouraging news, with more houses getting underway. Meanwhile, population growth continues to add to the need for housing.

So, what happens when we put the two together? This week, we look at the latest building and migration figures, what the RBA has said about the outlook, and what it could mean for clients considering a new build.

What’s Ahead for New Builds?

Australia’s latest construction figures provide an encouraging sign for the new-home sector.

ABS data released on 7 October shows 31,707 new private-sector houses commenced construction in the June quarter, up 11.6% from the previous quarter in seasonally adjusted terms. Those projects will add to housing supply as construction is completed.

Population growth keeps housing demand in focus

Australia’s population increased by 392,700 people through March 2026, with 292,100 of that increase coming through net overseas migration. Victoria alone gained approximately 109,500 residents over the same period.

Annual net migration was lower than a year earlier, but it remains a substantial contributor to population growth.

A growing population adds to the underlying need for housing across both rental and owner-occupier markets. Where the delivery of new homes cannot keep pace with demand, that imbalance can place pressure on prices and rents upward.

What still needs to be checked?

Having equity is one part of the application. The lender will also consider:

• The accepted property valuation and permitted loan-to-value ratio
• The existing land debt and total funding required
• The buyer’s income, expenses and ability to meet repayments
• The building contract, additional costs and any required cash contribution

Cash may still be needed for the builder’s deposit, fees or items outside the approved finance. If the land loan is with a different lender, refinancing may also be required to arrange the construction funding.

What this could mean for future prices?

There is credible support for a longer-term recovery outlook.

Speaking on 8 September, RBA Assistant Governor Sarah Hunter pointed to continuing population growth and supply constraints as reasons to expect house prices to eventually recover from the current downturn. She also acknowledged uncertainty about how far prices could fall and when a recovery would begin.

Our reading is that these fundamentals support the ongoing need for new homes. They do not guarantee price growth in every suburb or development, as local supply, affordability, and interest rates also influence outcomes.

What this means for your next client conversation

For clients considering a build, the longer-term outlook should sit alongside four practical considerations:

• Local demand and the supply of other new homes nearby
• The complete land and building budget, including additional costs
• The lender’s assessment of the proposed completed property
• Affordable repayments and a cash buffer throughout construction

A sound building plan should work on today’s numbers, with any future capital growth providing an additional benefit.

If you have clients revisiting their building plans, send them through. We can help clarify their finance options and work through the budget for their proposed home.

Have a great weekend.

Interest Rates

Variable

These indicative variable rates are for selected owner-occupier products, based on a $500,000 loan at 80% LVR, with principal and interest payments over 30 years (as of 2 October 2026):

1 Year Fixed

The rates below are indicative 1-year fixed rates for selected owner-occupier products, based on a $500,000 loan at 80% LVR, with principal and interest payments over a 30-year loan term (as of 2 October 2026):