Tackling Housing Affordability in SEQ

In Southeast Queensland (SEQ), the reality of housing affordability is stark. Median income households, earning around $1,950 per week, can afford only about 5% of the homes sold over the last 12 months. This highlights a growing challenge that demands a multi-faceted response. 

Despite current efforts, government initiatives have not done enough to accelerate new housing construction. This is largely due to infrastructure limitations that restrict land supply. As a result, most of the housing supply in the short to medium term will come from developments already underway or recently approved. This will likely limit sales volumes to the rate of land releases and production rates, further exacerbating the imbalance between supply and demand, which in turn will push prices higher. In the near term, affordability will be the only factor holding back demand. 

In addition to these constraints, high construction costs and a shortage of labour—compounded by a strong pipeline of public sector projects—are putting added pressure on new apartment supply. This is making greenfield developments the most viable source of new housing. 

A Mixed Housing Strategy 

To keep new developments affordable, it’s expected that both lot and build sizes will continue to shrink. This will place greater emphasis on enhancing community amenities to compensate for the more compact living spaces. Addressing affordability will require a balance of traditional detached houses, townhouses, and apartments within well-planned precincts that offer easy access to essential services. 

Interestingly, we’ve seen a shift in the types of dwellings being approved. Over the past year, approvals for houses and townhouses have increased, while apartment approvals have declined. Rising construction costs have made apartments more expensive to build than detached houses. This further underscores the need for affordable land and diverse housing options, including detached homes, townhouses, and affordable Build to Sell (BTS) apartments. 

Satellite Cities Offer A Path Forward 

One viable solution is to focus on developing satellite cities, such as Springfield, to offer more housing options for future homebuyers. These precincts, like Yarrabilba, Flagstone, Ripley Valley, and Waraba, present opportunities to create communities that are both liveable and sustainable. With the right planning and support, these areas can offer residents a balanced lifestyle, where they can live, work, and play without relying on long commutes. 

Strategic planning will be key. The focus should be on creating communities with town centres, transport nodes, and efficient connectivity. Additionally, support from all levels of government is crucial to unlock more affordable land, especially in high-growth corridors. The recent opening of land in the Waraba PDA after a 15-year delay is a promising step in the right direction. 

A Collaborative Approach for SEQ’s Housing Future 

The future of SEQ’s housing market relies on a targeted, collaborative approach. By leveraging existing PDAs and creating new urban centres, we can work towards a more balanced housing market. The support of developers, councils, and government bodies will be vital to ensuring that affordable housing options are available for all. 

As we move forward, it is clear that without comprehensive planning, continued collaboration, and the unlocking of affordable land, Queensland’s housing supply will remain below target, deepening the ongoing housing crisis. But with a focused effort, a more balanced and accessible housing market is within reach. 

This article references findings from our November 2024 South East Queensland Greenfield Market Report. Read the full report here.