- Supply remains one of the biggest barriers to Australians entering the housing market
- New Westpac research said a quarter of first homebuyers said the lack of listed properties is holding them back
- New data shows building approvals fell in January for a second consecutive month
More than one in four first homebuyers (26%) report a lack of listed properties is holding them back from home ownership, new Westpac research has found.
That marks a 14% jump in such sentiment since 2019, while competition among first homebuyers for limited stock remains the biggest barrier for two in five (39%) would-be buyers.
Westpac's chief executive of consumer Carolyn McCann said increasing housing supply needs to be one of Australia's most urgent priorities.
"We have a responsibility to the next generation of Australians," she said.
"Housing is a fundamental right. We need to build more homes at the right price point so that every Australian feels they have the chance to own their own home."
Housing shortfall critical in mid-sized capital cities
Australia's housing stock remains well below historic averages, particularly in Australia's mid-sized capital cities.
As at February 2026, Perth listings remained 48% below their five-year average, those in Brisbane were 31% below, and Adelaide was 23% lower, according to Cotality data.
The drop in advertised stocks levels was less critical in Sydney and Melbourne, where they were 1% and 4.3% lower respectively.
Across all markets, Cotality noted price growth was highest for entry-level housing - the lowest quartile of the market - while upper quartile prices had gone backwards in some markets.
Cotality's Tim Lawless said there is significant competition at the affordable end of the market.
“First home buyers, investors, and subsequent buyers are all competing across this sector of the market," he said.
Building approvals languish in January
The latest building approvals data, released on Tuesday, showed the total number of dwellings approved fell by 7.2% in January (seasonally adjusted).
It marks the second consecutive monthly decline, largely driven by a 24.5% drop in the number of private apartment and townhouse approvals.
Private sector house approvals rose marginally, up 1.1% over the previous month.
The numbers suggest Australia will fall well short of the federal government's target to build 1.2 million new homes by July 2029.
First home buyers open to alternative homeownership methods
The Westpac research found aspiring home owners were more likely to be open to new and alternate ways to help boost supply.
More than a third (35%) of first home buyers said more build-to-rent or rent-to-buy properties could help make housing more affordable.
One quarter of respondents said more land should be freed up for new housing.
"Across the country, we're seeing younger Australians adapt to the realities of the housing market with many recognising that increased density and alternative housing models are essential to improving affordability," Ms McCann said.
First home buyers not immune to NIMBYism
While one quarter (24%) of first home buyers think more apartments or townhouses in existing suburbs could help alleviate affordability barriers and 16% want increased density limits, more than half (52%) are concerned about high-density buildings being built in the suburb they live in.
Three in five (61%) fear such growth could lead to increases in rent or rates, half (47%) are concerned it may encourage high population growth, while two in five (38%) are worried it will change the lifestyle or vibe of the suburb.
"Australians care deeply about the character of their suburbs but the reality is unless we increase supply, younger generations will continue to be locked out of home ownership," Ms McCann said.
"This is a national challenge that requires balance, protecting what people value while creating the homes we desperately need."
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| Lender | Home Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Repayment type | Rate Type | Offset | Redraw | Ongoing Fees | Upfront Fees | Max LVR | Lump Sum Repayment | Extra Repayments | Split Loan Option | Tags | Features | Link | Compare | Promoted Product | Disclosure |
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5.93% p.a. | 5.93% p.a. | $2,975 | Principal & Interest | Variable | $0 | $395 | 70% | Disclosure |
