Green shoots revealed in the midst of SA’s housing shortage crisis

South Australia’s housing crisis has been laid bare, with a new report revealing current construction levels are only meeting 80 per cent of the state’s underlying demand.

Mike Mortlock of MCG Quantity Surveyors’ new report “The Pipeline Problem: Australia’s Housing Supply Gap” highlights the need for more housing in SA, showing current activity has dropped off of the comeback it made in 2022 when dwelling completions sat at 12,000 – up from the 9400 recorded in 2014, buoyed by the Home Builder and the northern defence build-up.

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“FY 2025 output is pacing around 11,000 – about 8 per cent below peak as cost pressures curb townhouse infill in the inner suburbs and slow greenfield stages around Mount Barker and Victor Harbor,” the report read.

“Population momentum is stretching the thinner pipeline.”

The report stated net overseas migration and interstate inflow added 34,000 residents in 2024.

“Using the state’s average household size of 2.4 persons per dwelling, South Australia needs roughly 14,000 new homes a year just to hold vacancies steady,” the report read.

Mike Mortlock of MCG Quantity Surveyors. Supplied

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“Current construction therefore meets only about 80 per cent of underlying demand.”

The report showed in less than a decade the state had swung from balance to persistent shortage, with southern Adelaide, central Adelaide and hills, and Barossa and the Lower North critically low.

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Housing Industry Association chief economist Tim Reardon said escalating building and tax costs was pushing up the prices of new apartments in some markets to levels that buyers were not willing to pay.

“Few households are willing to pay the (premium) for a new unit when established units are so much cheaper,” Mr Reardon said.

“For apartment building to increase meaningfully, we would need to wait for established units to become so scarce that the prices would catch up with those for new units.

“It could take years.”

HIA Chief Economist Tim Reardon. Supplied

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While completions may not be where they need to be at the moment, there is action in the works through the 30-Year Plan for Greater Adelaide to get more homes on the ground, or in the air, as is the case with the numerous high rise apartment complexes going up around the state.

Just a few of these developments include Forestville’s 290 dwellings off Anzac Hwy, Riverlea’s 12,000 homes at Buckland Park, Fort Largs’ 335 homes, Eighty Eight O’Connell’s 160 homes at North Adelaide and Seaside at Moana’s 385 allotments.

Many are being held up by not so much a lack of tradespeople to build them, but a lack of suitable infrastructure like SA Water connection, forcing some developments to build their own wastewater facilities in order to avoid a two-year wait.

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Lawyer Liza Jennings, 24, has bought an apartment off-the-plan at South Plympton she is about to move into, and said it was exciting to see the building activity around her.

“I have a balcony that looks over what’s going to be a park and there are townhouses and more apartments being built around me and I’ll be able to watch that happen,” she said.

Liza Jennings outside her recently purchased property at South Plympton. Picture: Ben Clark

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“The government’s put a huge emphasis on new builds and new developments but the one thing I have noticed is that they’re quite far away from the city.

“To have more infill developments around the city centre would be good, but obviously finding the land space for that as well is a challenge.”

– with Aidan Devine