Australia’s home building scene is buzzing again – but it’s not just first home buyers leading the charge.
Renovators and property investors are the real movers behind the hammer and nails, as home improvement activity nears record highs.
According to new ABS data for the September quarter 2025, lending for renovations is now almost three times higher than before the pandemic, a surge fuelled by rising house prices and low unemployment. HIA Chief Economist Tim Reardon said households were choosing to renovate rather than relocate, with the high price of land pushing many families to expand their existing homes instead of buying elsewhere.
As a result, renovations activity is growing twice as fast as the rest of the economy.
At the same time, investors are quietly rebuilding their dominance in the housing market.
The ABS found investors accounted for 43 per cent of new homes built in the September quarter – well above their usual one-third share.
Mr Reardon said investors were playing a vital role in bringing new homes to market, especially as owner-occupier demand cools.
The latest data also shows a continued increase in long-term arrivals to Australia, adding further pressure to an already tight housing supply.
Mr Reardon warned that increasing taxes on investors would not fix the problem, arguing it could slow the rate of new builds even further.
He said policymakers need to ensure a strong pipeline of shovel-ready land, cut red tape, and reduce the tax burden on builders and developers to prevent affordability from worsening.
Nationwide, the number of loans issued for new home purchases and construction slipped just 0.2 per cent over the quarter.
Tasmania and New South Wales bucked the trend with strong growth – up 18.2 and 12.3 per cent respectively – followed by the ACT (up 8.5 per cent) and Victoria (up 0.3 per cent).
Declines were recorded in Queensland (-0.4 per cent), Western Australia (-3 per cent), South Australia (-3.9 per cent) and the Northern Territory (-26.8 per cent).
All told, Australia’s housing story is shifting from buying new to reinventing the old.
