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Western Australia is a big state with an even bigger housing problem.
The key fundamentals of the state’s booming property market are limiting the state’s growth potential and economic diversification prospects, with no relief in sight.
Both listings and the average time to sell hover around record lows, as does the availability of rental properties.
The crisis has serious long-term repercussions for the state’s future, and it is critical that we implement practical and robust strategies to alleviate housing pressure.
These strategies should be multi-faceted, involving collaboration between government and industry to provide sustainable results in the short and long term.
The construction sector will play a pivotal role in aiding WA’s recovery from housing under-supply. Possible solutions could include zoning reforms, public-private partnerships with developers, smarter urban planning to maximise land use, and training programs and incentives to address construction skills shortages.
Damian Collins, Chairman of Westbridge Funds Management, says skilled migration is required to fill crucial job vacancies and fuel further growth, although this necessary influx of workers is simultaneously exacerbating the housing shortage.
“The key to alleviating this pressure lies in significantly boosting our housing supply. However, we're facing a major obstacle: a critical shortage of construction workers. Without sufficient skilled labour, we're unable to build new homes at the pace required to meet the rising demand. It's a multifaceted issue that calls for immediate and comprehensive action,” he says.
“We need to prioritise bringing in skilled tradespersons who can contribute directly to our housing construction efforts. We also need to look at ways to fast-track building approvals, adopt more efficient construction methods, and remove unnecessary red tape. Every day counts when you're trying to close a supply gap of this magnitude.”
Potential short-term solutions to the crisis could include expedited land releases and approval processes to allow for the rapid construction of new homes. Direct government intervention in building affordable housing units could also help to meet more immediate demand, while first home buyer and shared ownership incentives would help to reduce cost barriers.
For the rental market, expanded rental assistance programs and tax incentives for landlords could ease the strain.
Peter Packer, Co-Founding Director of Dorado Property, suggests that Perth’s housing affordability crisis can be tackled by reducing the size of new homes.
“Smaller homes are not only more affordable but also more sustainable, as they require fewer resources to build and maintain. This approach could make housing more accessible to a broader population, addressing both economic and environmental concerns,” he says.
“Perth needs to see a culture shift away from freestanding houses towards apartment living. Standardising building designs could significantly reduce construction costs, with regulatory flexibility key to facilitating this standardisation, which would in turn expedite the housing approval process.”
Increasing the number of affordable homes available through social housing is also essential. In the 1960s, public housing comprised 10%-15% of Australia’s total housing stock, reflecting significant government investment in large public housing estates. Today, social housing represents less than 5% of the total housing stock. 
Social housing provides affordable rental options for low-income households, increases the overall housing supply, and offers long-term stability compared with the private rental market. Additionally, well-planned social housing projects can foster community development and improve access to essential services and amenities.
WA can learn from Singapore’s successful housing model, where the government plays a significant role in building and selling affordable high-density flats.
The collaboration between government, private sector, and community stakeholders will be vital to ensure the state and its cities remain vibrant and accessible. So long as solutions are well-rounded and feasible, it is possible for WA to recover from the crisis while laying the groundwork for a more stable and affordable housing market.
By adopting these measures, we can create a more equitable housing market and ease housing pressure.
