The ACT is approving fewer homes than it did before the National Housing Accord began, new research from the Master Builders Association suggests.
The accord is an agreement between the Commonwealth, state and territory governments to build one million new homes between July 2024 and July 2029.
Two years in, however, housing approvals are down 17.2 per cent from what they were before the accord began, and down 31.6 per cent from the previous decade.
Since the accord started in July 2024, the ACT has approved an average of 290 new homes each month, compared to 350 in the two years before it started.
Completed homes and construction or purchase loans have also dropped from the years before the accord began, according to the Master Builders Association.
Tom Henderson has been in the building industry for 25 years. Born and raised in the bush capital, he feels strongly about preserving the territory's unique lifestyle and nature.
However, he is concerned that approval processes in the territory can become drawn out, especially in established suburbs with numerous trees, and further exacerbate the housing crisis.
"Australia has some of the highest labour and material costs in the world, and regulatory compliance adds a significant overhead on top of that," he said.
"The approvals process is something government can act on right now. Streamlining that, reducing delays and red tape without compromising standards, is one of the direct levers available to actually get more homes built."
The ACT's construction industry has been facing an increasing number of difficulties since the start of the year: the rising cost of fuel has meant the cost of building has skyrocketed, at the same time that a record number of apprentices are leaving the industry before becoming qualified.
"The construction industry is navigating genuine complexity right now," Mr Henderson said.
"Homes are more sophisticated than ever: more material choices, more housing types, higher quality expectations.
"That's largely a good thing but it does add real risk and cost for builders trying to deliver at scale."
Master Builders ACT chief executive Anna Neelagama said builders in the territory were operating in the highest property tax environment in the country, but were not able to deliver as many homes as their interstate counterparts.
"The ACT now has the worst multifactor productivity in the country, and building and construction businesses are being asked to do more with less," Ms Neelagama said.
"Builders are ready to deliver more housing, but they are being held back by slow planning processes and increasing complexity."
Ms Neelagama said the ACT government needed to streamline approvals or risk falling behind on its housing targets.
The ACT has committed to building 30,000 new homes under the accord, but is currently 1450 homes behind schedule, according to the Master Builders Association.
Earlier this year, federal minister for housing Clare O'Neil said the government set ambitious targets because housing was "one of the biggest challenges facing the country."
"We've built about 260,000 homes in the first six quarters of that five-year period. The experts who advise us tell us that we are close to getting to a million of the 1.2 million," Ms O'Neil said.
