Australia’s Housing Market in Crisis – What’s Next?
When our Director, Ewan Ramsey attended the Australian Financial Review Business Summit 2025 last month, a sobering
reality check was delivered on the state of the housing market.
Australia faces a severe housing supply shortage, driven by rising construction costs, restrictive policies, and productivity challenges in the building sector.
At Ramsey Property Wealth, we recognise that investors play a vital role in solving this crisis by supplying rental
housing and contributing to long-term affordability. However, policy uncertainty, planning delays, and negative investor sentiment are
making it harder than ever to provide quality housing.
Ewan's Key Findings from the AFR Business Summit 2025
1️⃣ Housing Supply Cannot Keep Up with Demand
Fact: Australia is building homes at half the rate of 30 years ago
The summit confirmed that construction
productivity has declined by 10-12% over the past three decades. This means houses take longer to build and cost significantly more than
they should.
The Root Causes:
- Complex planning regulations at federal, state, and local levels.
- Rising labour shortages and lack of skilled trades.
- Slow adoption of prefab & modular housing due to regulatory barriers.
The Solution: Streamline approvals, incentivise modern construction techniques, and remove unnecessary bureaucratic delays
that slow down housing supply.
2️⃣ Migration & Population Growth Are Outpacing Housing Construction
Fact: Population growth has skyrocketed, but housing supply has failed to keep up.
In 2024 alone, Australia
saw a record influx of new residents, with rental demand far exceeding available properties.
What this means for property investors:
- Higher rental demand in key markets.
- Stronger long-term yields for well-located properties.
- Increased pressure on government housing policy & planning reforms.
The Solution: Governments must align migration policies with housing strategies and encourage private investment in
rental housing rather than discouraging it through restrictive policies.
3️⃣ Investors Are Key to Rental Supply – But Are Being Pushed Out
Fact: Private investors provide the majority of rental housing in Australia, yet they face increasing restrictions.
Negative
gearing, capital gains tax changes, and rising compliance costs are making it harder for investors to enter and stay in the market.
The risk of discouraging investors:
- Fewer rental properties means higher rents for tenants.
- Less supply means increased housing unaffordability.
- More reliance on government intervention, which historically fails to keep pace with demand.
The Solution: Policymakers must stop treating investors as the problem and instead support responsible, long-term property investment that contributes to housing supply.
The Path Forward: How Investors Can Thrive in 2025
At Ramsey Property Wealth, we're committed to helping investors navigate market challenges while playing a critical part of the housing solution.
- Take a long-term approach: Focus on high-demand, growth locations with strong fundamentals.
- Leverage financial structures wisely: Ensure debt strategies align with cash flow stability.
- Understand policy risks: Work with experts to navigate tax, finance, and regulation changes.
- Be adaptable: Dual-income properties, regional markets, and co-living spaces are becoming more attractive investment options.
The AFR Business Summit reinforced one critical point:
🏡 Australia needs more investors, not fewer 🏡
The housing crisis will only worsen if investment slows down. Astute investors active in the current marektplace will be
well-positioned for long-term success.
Contact the Ramsey team today on 1300 001 215 to start/continue building a profitable property portfolio with us.
