Confidence rises, but housing supply and construction challenges persist in property sector

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While industry confidence ticked up by eight points to a Confidence Index score of 116, persistent concerns around housing supply, affordability, and construction challenges underscore the hurdles ahead.

Confidence increased across most states, with New South Wales and Queensland rising by 13 points each to scores of 120 and 126, respectively. South Australia remains the most confident state, despite a slight dip to 129, while Victoria continues to lag behind, climbing only four points to a negative sentiment of 95.

Property Council Chief Executive Mike Zorbas noted the varied performance, saying: “Confidence levels show optimism in some states, but Victoria remains a key area of concern with prolonged challenges.”

For only the fourth time since 2011, respondents across every asset class (housing, retirement villages, offices, and industrial assets), reported that construction activity levels are expected to fall below historical averages.

Housing construction expectations sit two points below the historical average, while price growth expectations soared to 21 points above. National economic growth expectations remained subdued, scoring a -6 on the index.

“High barriers to construction, high input costs, and low market capacity are all showing up in weak construction expectations,” said Mr Zorbas.

The survey revealed that nearly 40% of respondents see housing supply and affordability as the top federal issue, with economic management following at 19%. At the state level, 43% of respondents prioritise housing supply and affordability, with property taxes and charges cited by 23%.

The Property Council also emphasised the urgent need for government intervention, particularly with an ambitious national target of 1.2 million new homes by 2029.

“With the federal election nearing, all parties must recognise that supply is first, second, and third in solving the housing crisis,” Mr Zorbas said.

Procore’s General Manager, APAC, Chris Skelton, echoed this sentiment. “Australia’s housing crisis remains a significant societal challenge for our federal and state governments, fuelled by contributing factors such as the ongoing labor shortage and regulation reform.

“Now more than ever, access to data-driven construction management technology is fundamental to help the property industry reduce risk, drive operational efficiency, and build together.”

Housing affordability and supply still the dominant issues

The survey revealed that housing affordability and supply remain the most critical issues facing the property sector. With affordability challenges dominating headlines and housing construction activity below historical averages, industry leaders are calling for urgent action.

“Collaboration between government and industry is crucial to addressing Australia’s housing crisis, particularly in delivering affordable stock,” a respondent said.

Looking ahead, the property sector faces the dual challenge of tackling affordability while addressing operational inefficiencies that hinder construction growth.

With confidence rising in several states, 2025 holds promise for recovery, but as Mr Zorbas summarised, “Solving the housing crisis requires action on all fronts – from reducing costs to cutting red tape and fostering greater investment.”

Key state confidence scores

  • South Australia: 129 (highest)
  • Queensland: 126 (+13 points)
  • New South Wales: 120 (+13 points)
  • Western Australia: 119 (+3 points)
  • Victoria: 95 (lowest, +4 points)



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Nicole Lambert
Nicole Lambert
Nicole Lamber is a news writer for LinkDaddy News. She writes about arts, entertainment, lifestyle, and home news. Nicole has been a journalist for years and loves to write about what's going on in the world.

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