Australia’s annual building approvals have climbed above 200,000 for the first time since Labor’s housing accord target came into effect but they are still almost 83,000 short of what’s needed to meet a political goal.

Despite builders continuing to top the insolvency charts, the Federal Government is still insisting it can build 1.2 million homes over five years, without any meaningful cut to immigration-fuelled population growth.

It is now also hoping restricting negative gearing to new builds from mid-2027 will somehow boost the supply of housing — despite a warning from a public housing advocate that stopping future landlords from getting tax breaks on an established property will lead to soaring rents.

The 200,424 building approvals tally for the year to April was the best year-on-year number since the National Housing Accord target began in July 2024 and marked an improvement on the 189,893 approvals for the 2024-25 financial year.

But they are still well short of the 240,000 annual average needed for that lofty target to be met, new Australian Bureau of Statistics figures showed.

Australia has also failed to approve more than 20,000 new residential homes in any given month since the target began and last surpassed that mark in May 2021 when Reserve Bank interest rates were still at a record-low of 0.1 per cent.

“Almost two years on and the National Housing Accord has never once reached its minimum monthly target even under the most generous measure,” Institute of Public Affairs senior fellow Kevin You said.

“In fact, housing approvals have been lower than what they were in the middle of the pandemic.”

In April, just 16,710 new building approvals were issued, marking a monthly fall of 3.4 per cent.

The 357,302 homes approved since July 2024 is also 82,698 behind schedule.

If councils and State governments had kept up with a political building approvals target, Australia would instead have 440,000 projects in the pipeline in a little under two years, as part of that 1.2 million target over five years.

Labor’s bid to boost housing construction is occurring as construction companies continue to top the insolvency charts with 3010 of them going into administration between July 1, 2025, and May 17 this year.

That is 66 per cent higher than the 1819 insolvencies in the next most beleaguered accommodation and food services sector, based on Australian Securities and Investments Commission figures.

In a desperate bid to boost housing construction, the Budget announced that negative gearing from July 2027 would be restricted to new homes.

While tax breaks for existing landlords, who signed a contract before Budget night, would be grandfathered, future investors would be deterred from wanting to buy an existing house or unit to lease out and claim rental losses on tax.

It’s not just property industry lobbyists who are worried, with a public housing advocate who represents tenants raising concerns about soaring rents if there were fewer investors.

“My concern is people’s responses to it and whether they fully understand the changes in relation to negative gearing and whether people might react and get rid of properties, having an impact on the market,” this insider told The Nightly.

“Of course, if you change supply in the rental market, then the market does what it does — it will increase prices.

“If you don’t have that supply, then prices will react accordingly.”

Then there is the issue of immigration-fuelled population growth, with the Budget forecasting 295,000 net overseas migrants coming to Australia in 2025-26.

This was 35,000 higher than the 260,000 predicted as recently as December.

Former Labor frontbencher Kelvin Thomson, who rejoined the party in 2024 after a stint with the Sustainable Australia Party, said strong population growth meant the housing affordability crisis would continue, even if higher interest rates and Budget tax changes caused house prices to fall marginally.

“Those things may be having some impact, but I think it’s likely that housing will continue to be unaffordable for many young people,” he told The Nightly.

“It’s foreseeable that we will continue to have migration-fuelled rapid population growth and housing problems associated with that.”

Treasurer Jim Chalmers claims he only wants house price growth to slow, not fall.

“We’re not targeting a particular price outcome, a particular percentage or dollar figure when it comes to housing,” he told reporters on Tuesday.

Surely, slashing immigration would be a far easier task than trying to meet an unachievable housing target come June 2029.