Australian home-building costs surge nearly 30% in five years, report says
A new Insurance Council of Australia report finds that building a house in Australia has become almost 30% more expensive over the past five years, with some materials rising up to 70%. The rise is most pronounced in Queensland and northern regions.
According to a report released by the Insurance Council of Australia, the cost of constructing a new home has risen almost 30% over the last five years, with certain building supplies soaring as much as 70% in price. The steepest increases are seen in Queensland and northern Australia, where building expenses are now 44% higher than in 2021. Between 2022 and 2026, insurers handled 400,000 claims for storm-damaged homes, amounting to $11.3 billion in payouts, while the number of homes repaired each year is approaching the number of new builds.
Materials most needed after disasters, such as roof tiles, windows, plasterboard and concrete, have seen the biggest price jumps. ICA chief executive Andrew Hall said inflation and more frequent extreme weather are driving up premiums and forcing insurers to compete with builders for scarce resources. Professor Paula Jarzabkowski of the University of Queensland urged the construction of more resilient, “future-proofed” homes and a shift away from building in high-risk areas to reduce the cycle of rebuilding existing houses.
Why it matters
Rising construction costs and frequent storm damage strain both insurers and home-buyers, affecting housing affordability across Australia.
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