An upcoming Economic Reform Roundtable scheduled for August 19-21 aims to address these issues by focusing on strategies to improve productivity, with key industry figures participating.

Australia's economy has been hampered by weak productivity growth, averaging just 0.2% annually from 2017 to 2024, which has significant implications for the housing market and overall economic health.

In the first quarter of 2025, only 43,517 new homes were completed, falling well short of the 60,000 homes per quarter needed to reach the 1.2 million target by 2029, highlighting a significant undersupply.

The housing shortfall is estimated to be between 200,000 and 300,000 dwellings, with the government's failure to meet building targets exacerbating the problem.

Economist Shane Oliver suggests that boosting productivity could positively influence the housing market by possibly lowering interest rates, even if higher real interest rates pose a risk.

If productivity can be increased, it could ease housing supply shortages and potentially lower property prices, which would benefit both mortgage brokers and prospective homebuyers.

This sluggish productivity is compounded by supply chain disruptions, increased regulation, labour shortages, and a 53% rise in material costs, all of which have delayed home building projects.

As a result, the time to build a detached house has increased markedly, from around 8.5 months in 2014 to 12.7 months in 2024, with Western Australia experiencing an 85% rise, contributing to housing supply constraints.

The Property Council emphasizes the need for government support in the housebuilding sector, noting that the lengthy process of building homes impacts future buyers and renters.

The sluggish productivity growth has constrained economic capacity, leading to slower growth in incomes, wages, and consumption, thereby affecting the mortgage finance market.