Up for a challenge? The Australian housing industry re-examined

This paper examines the supply of housing in the volume building sector in the context of housing supply shortage and lengthening construction times. It aims to reveal organisation arrangements and work practices that may contribute to delays in building completion times. The paper begins by examining housing supply and delivery times in Australian cities, with statistical analysis establishing that there is an increasing gap between supply and demand, and along side this, a significant rising trend in construction times. The paper then examines the volume building sector in more detail, considering the changing nature of the housing commodity, the contracting system for organising labour and materials supply, and the management system for housing delivery. Drawing on industry analysis and interviews, the paper argues that existing contract delivery models are experiencing growing pressure, which is in turn contributing to increasing delivery times and costs. In particular it identifies and characterises three issues that help explain increasing delivery times and costs: the increasing complexity in the commodity itself; the challenges of coordinating and scheduling delivery of increasing complex product; and the impacts of poor quality work. In light of these findings, the paper argues for the importance of examining the operations of the housing building industry, and the nature of the commodity itself, in better understanding the drivers of increasing delivery times and increasing costs in the supply of suburban housing.