Why does it cost so much to build in Australia right now? In this week’s 2 Sense episode of the Australian Property Podcast, Pete Wargent and Chris Bates unpack a fresh construction squeeze just as the housing market heads into a Budget week that could reshape investor behaviour.
They break down the numbers behind the build-cost blowout, including the sharp rise in the cost of delivering a dwelling since 2019, and explain why higher diesel, concrete, piping, plumbing supplies and financing costs all matter. If feasible projects become marginal and marginal projects become unfeasible, the supply response Australia desperately needs gets pushed even further out.
The conversation then shifts to the policy risk. Pete and Chris explore reported changes to capital gains tax and negative gearing, the possibility of investor demand changing shape, and why anti-investor settings can still have unintended consequences for rents, supply and affordability. They also touch on softer conditions in Sydney and Melbourne, rising mortgage stress at the edges, stronger rental yields and what buyers and sellers should be thinking about strategically.
The episode rounds out with listener questions on whether to sell an investment property and move more capital into ETFs, and how to think about the right balance between property and shares for long-term retirement goals. It’s a practical, timely listen for anyone trying to read the next phase of the housing market.
