“The standard [of new homes] is already so much higher than the majority of all the other housing stock that’s in the market,” he said. In Sydney, two bedroom inner-city terraces largely untouched since the 19th century can sell for north of $1.5 million.
The National Construction Code sets minimum standards for building homes in Australia and is updated every three years.
When the code was updated in 2022, Duggan said Metricon had to update every one of its more than 500 home designs and review its supply chain to find materials that met the new standards, which took two years.
“Smaller builders, I’m not sure how easy they would have found that,” he said.
The majority of Australia’s construction sector is made up of small businesses, according to the Committee for Economic Development of Australia. The Productivity Commission’s report on housing construction this year flagged that the NCC worked “in principle” but that some aspects of the code and the way it is implemented “impose unnecessarily high costs on building construction”.
Among the latest updates to the NCC are standards aimed at improving the accessibility of new homes, such as ensuring there is no step from the street up to the entrance of a home, having ground-floor toilets and making hallways wider.
But city planning experts have pushed back against the builder’s claims, saying that a fall in standards could mean Australia’s cities become awash with low-quality housing that people did not want to live in.
UNSW senior lecturer in city planning, Ryan van den Nouwelant, said building substandard homes was not sustainable.
“If we build a lot of homes in crisis mode, we end up with cities with a whole bunch of low amenity housing that no one really wants, and we’re stuck with it because this stuff doesn’t go away for 60, 100 years,” he said. “I’m also reluctant to say that if you’re in a wheelchair or something, ‘bad luck, go find yourself a house somewhere else’.”
University of Sydney professor of urban and regional planning Nicole Gurran said there was no evidence that regulatory barriers are preventing new supply.
“The evidence is that we’ve got a whole lot of housing already approved, that isn’t moving forward, and that’s because the market’s sort of lacklustre,” she said.
Adam Haddow, National President of the Australian Institute of Architects, said delaying code updates would create more problems later on.
“Building upgrades cost significantly less when the code is updated more frequently,” Haddow said. “A pause creates costly backlogs of quality and safety improvements that ultimately burden the industry and society.”
Michael Fotheringham, managing director at the Australian Housing and Urban Research Institute said Australian housing rules had lower standards than other countries. “The regulations are more complex, but… the expectations are actually lower.”
Property Council Group policy and advocacy executive Matthew Kandelaars said standards such as ceiling heights, stair widths or natural light requirements – taken in isolation – did not necessarily make compliance with building codes difficult.
“The challenge comes through the interaction of these things,” he said. “Thermal performance requirements might impact a window design choice, but doing so may then impact natural light or ventilation requirements.”
Some state-based planning guidelines that are meant to improve livability are also directly affecting affordability, according to spokespeople from advocacy groups that want to see more housing in capital cities.
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YIMBY Melbourne said requirements for outdoor space – despite proximity to parks – and upper-level setbacks – where upper floors must be smaller than lower floors – were hampering development and housing choice. Sydney YIMBY said councils requirements for parking spaces per dwelling should be abolished.
Both groups said restrictions on apartment sizes – in Sydney, a three-bedroom apartment must be 90 square meters, and in Melbourne, it must be 85 square metres – should be relaxed.
“It is too hard to build a house in our country today,” Housing Minister Clare O’Neil said on August 14. “I spoke to a builder on site a couple of days ago who said to me: “You know, Clare, the really hard thing about building back in the day used to be actually building a house. Today it’s the bureaucracy and the red tape and the delays.”
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