SA tops HIA Housing Scorecard

The Housing Industry Association (HIA) revealed on 23 April that South Australia has once again been ranked the highest in its Housing Scorecard report.

The report ranks the states and territories based on 13 residential building indicators against their respective decade averages, including renovations, detached, and multi-unit building activity; rates of interstate and overseas migration; and housing finance.

South Australia scored 78 in the Housing Scorecard, out of a maximum score of 104, followed by Queensland with 73 and Western Australia with a score of 70.

According to Stephen Knight, HIA’s executive director: “South Australia is one of the few markets where first home buyers can still afford a house and land package.”

He continued that South Australia had the strongest detached housing sector in Australia and still had “resilient” market activity despite cash rate rises from the Reserve Bank of Australia, which has now held at 4.35 per cent since November 2023.

The executive director also said that increased high-density development across the state in areas that are supported by transport services would “accommodate” future housing demand in the state, before revealing that South Australia had the strongest renovations sector in the country, stating that it was “well above” pre-pandemic levels.

Knight also noted that Western Australia has had a “remarkable surge” in the Housing Scorecard rankings, going from seventh place (out of eight) to third in only one year. He said that the state has “[capitalised] on its affordability advantages and strong economic and employment opportunities”.

Queensland came in second place, having traded places with South Australia in this year’s report. Knight attributed the decline of Queensland in the ranks to the state receiving a high number of internal and overseas migrants.

The executive director said that the main constraint for states such as Queensland, Western Australia, and South Australia was having enough labour to meet growing housing demands; however, he said that this issue has gradually eased.

Speaking on the housing landscape for NSW and Victoria, Knight said these states “face the most acute land affordability constraints in the nation. This has left their detached housing markets more vulnerable to the compounding effect of rising interest rates.

“Combined with the dramatic decline in new apartment development as state governments tax investment in housing, this has driven these states down the rankings into fourth and fifth position respectively,” Knight said.

Tasmania has declined in the HIA’s ranking to seventh place due to the departure of local residents and investors leaving the state, according to Knight, who also pointed out that the Northern Territory, which scored last at 33, is “still dependent on major government or mining sector investment to push it significantly up the rankings.”

Commenting on the ACT’s performance in the rankings, placing sixth, Knight said: “The Australian Capital Territory’s multi-units sector has been a valuable source of activity for this jurisdiction, testament to local authorities’ commitment to higher density living.

“A significant number of residents have nonetheless left the Territory since the pandemic shifted into the rearview mirror.

“The synchronised cycle of the pandemic is coming to an end. The mid-sized states are pulling ahead.”

[Related: Timeline for inflation target ‘remains uncertain’ as RBA holds]