The approval of new home builds in Western Australia has slowed to levels not seen since news first broke of the pandemic in 2020, according to new data from the Australian Bureau of Statistics.
It comes after one of the state's biggest home builders put a severe limit on new home builds to focus on finishing existing contracts.
The BGC Housing Group has restricted orders on new builds to an "absolute minimum", as many customers complained construction of homes with the company had ground to a halt.
The state government introduced legislative reform in 2021 to double the amount customers can claim under home indemnity insurance if a builder becomes insolvent, from $100,000 to $200,000.
New Home Building Brokers managing director Tristan Kirkham said many of these customers would not be covered by insurance.
"A lot of the homes won't be covered at certain progress payments, should a claim be made," he said.
"I would like to see a lot more done towards the residential sector for the residential builders and the residential consumers."
WA Liberal Party leader Libby Mettam said the state's housing construction woes were a result of the government not doing enough to address the state's skilled labour shortage.
"There needs to be more incentives for … international migration of skilled workers. We are seeing international skilled workers bypass Western Australia for other states," she said.
ABS data showed 9,500 international migrants settled in WA during the last financial year, around half the average annual number that moved here prior to the pandemic, and well below the 12,080 migrants that chose South Australia in 2021-22.
Ms Mettam criticised comments Premier Mark McGowan made yesterday, downplaying the heated construction market as a "better problem than having nothing".
"We need the McGowan government to understand that the industry is actually in crisis," Ms Mettam said.
"The Premier needs to be working with the building industry and ensure that there are some real solutions, which can provide better support [for] homeowners."
Mr McGowan said it was a problem that would be resolved with time.
"For the people that are waiting for a home to be built, it's very difficult, and I understand and accept that," he said.
"There's 30,000 homes under construction, and over time that will help solve the problem."
New builds down
New figures from the Australian Bureau of Statistics show the number of new houses being approved to be built, and the amount of money going into residential builds, has fallen in WA to 2020 levels.
The glacial pace of construction caused by severe labour shortages when the pandemic hit prompted the government to offer $117 million worth of grants for new home builds and property purchases.
Mr McGowan has defended the stimulus package he introduced in 2020 as a necessary move, and said it can't be blamed for today's issues in the construction market.
"What was within my control was trying to ensure we saved an industry that was potentially going to die," he said.
"We had phone calls flooding into our office form builders that were worried about going bankrupt – that was the situation we faced."
However, with BGC's decision to limit new builds, and the new ABS figures, the Opposition's housing spokesperson Steve Martin said the government was not doing enough to address housing shortages in the state.
"The Premier is ignorant of the facts if he thinks enough homes are being built quick enough to house Western Australians," he said.
"We have a crisis today in the building industry in Western Australia. Western Australians are waiting too long to be housed, and that crisis will get worse."
