Budget falls short: builders, developers

The residential building industry says the federal budget doesn't do enough to tackle the nation's housing shortage, while Australia's peak urban development industry group says it was "underwhelmed" by its content.

Last night's budget provided useful measures to boost skills and training, but contained nothing to address Australia's chronic housing shortage and deteriorating housing affordability, Housing Industry Association senior economist Andrew Harvey said.

Mr Harvey said the budget failed to deliver any dedicated policies to alleviate Australia's housing shortage, which stands around 200,000 dwellings.

"New home building activity is in danger of re-visiting GFC-like levels this year, yet the budget fails to address the excessive cost of new housing which in some instances sees more than 40 per cent of the purchase price of a new house attributable to government taxes, fees and charges," he said.

"Until the high taxation of new housing is reduced, and supply side obstacles removed, Australian families will remain locked out of home ownership and will continue to face high rental costs.

"There is only one way to make serious inroads into the housing affordability crisis - and that is by substantially increasing housing supply."

Mr Harvey said the HIA did welcome the budget's emphasis on skills, training and skilled immigration, but noted the inadequate funding of housing infrastructure had not been addressed.

Meanwhile, Urban Development Institute of Australia WA chief executive Debra Goostrey said while the budget contained some positive initiatives for the industry, the dollars attached to them meant there would be little more than a token effort to improve the housing situation.

Ms Goostrey said the budget tipped its hat at infrastructure, but said it failed to meet the needs of Australia's growing cities.

"In fact, there's very little in this budget of interest and few winners unless you are a Korean war veteran seeking an apprenticeship in a remote area," she said.

"Overall the budget reflects the political reality of a hung parliament; limited risk and an emphasis on the regions.

"It appears the government is saving its 'political capital' for getting the carbon tax through when the dust settles on this budget."

Ms Goostrey did say, however, the budget contained a few positives that would be welcomed by the development industry, including a $100 million suburban jobs initiative to help support local and state governments plan and deliver employment precincts, manufacturing hubs and multi-function developments.

She said a $29.2 million sustainable regional development initiative would improve planning in regions experiencing high growth, and welcomed $36 million committed to Infrastructure Australia over the next four years to tackle bottlenecks and improve freight networks.