Victoria's Recovery Is Delayed a Year. Recast Crew Off 60,000 Homes in 2026 — HIA Says You Will Not Cross That Until 2028.

Victoria is not tracking 60,000 starts this year

HIA Victoria Executive Director Keith Ryan, speaking on Monday 31 August 2026 after the HIA Economic and Industry Outlook, said federal housing-tax and investment changes will see Victoria’s home building recovery delayed at least another year.

The desk number is not the national Accord gap published on Friday. It is Victoria’s own threshold. Victoria commenced construction on 56,630 new homes in 2025. That volume was previously expected to get close to 60,000 in 2026. Ryan now says that threshold is not expected to be crossed until 2028.

If your 2026 crew, plant and land-bank plan still assumes a run at 60,000 Victorian starts this calendar year, recast it against HIA’s delayed path — not against a national print that commencements can still rise later in the cycle.

This article summarises published industry research. It is not financial, legal or construction-contract advice.

What HIA says is interrupting the Victorian expansion

Ryan points to two Federal Budget settings. The Australian Government has increased taxes on established housing, “explicitly noting in its Budget papers that this will result in 35,000 fewer homes being [built] across the country over the coming decade.” The subsequent prohibition on SMSFs borrowing to invest in residential property “will remove another source of new home finance, having a directionally similar impact on home building.”

Those settings, HIA says, have “interrupted an expansion in home building that was expected for Victoria in 2026.”

Ryan is also blunt about state settings: “The Victorian government has made things even worse with its excessive land taxes including the COVID debt levy, high stamp duty rates, absentee owner surcharges, foreign purchaser additional duty, and of course the windfall gains tax.”

The Victorian Government has set itself a target of 80,000 new homes built per year over the coming decade — “a target that is not expected to be met in any single year.”

Shortage is not the same as a recovery you can staff to

Victoria’s population continues to grow and households continue to form faster than new supply, Ryan said. “Victoria already has a significant shortage of homes and this will only get worse.”

HIA expects those structural forces to dominate the housing cycle and result in a return to positive home price growth from early 2027. The eventual increase in commencements “should not, however, be interpreted as evidence that Victoria’s housing shortage is being resolved. Rather, it is the shortage itself that will eventually generate the market conditions required to support more construction.”

That is the site-office distinction. A later lift in starts is HIA’s shortage working through price — not a signal that 2026 labour and plant should be held against an 80,000-a-year political target, or against the 60,000 threshold that has been pushed to 2028.

Why a softer established market still hits your new-home quote

Ryan’s structural point matches the national Outlook released Friday 28 August 2026: the established and new home markets are not separate. “There is a fundamental difference between reducing the price of an established home and reducing the cost of delivering a new one.”

“The tax rules may distinguish between new and established homes. The housing market does not.”

When established home prices fall but the cost of land, labour, materials, infrastructure, finance and regulation does not, fewer new housing projects stay financially viable. Once the market recognises the lack of new supply, HIA says prices head back up and affordability deteriorates again.

If governments want more housing, Ryan concluded, they need to reduce the cost of construction — “not damage market confidence in a way that just temporarily suppresses prices in the established market.”

Practical moves for the next four weeks

1. Recast Victorian crew and plant off 60,000 starts in 2026. HIA now puts that threshold in 2028. Hold labour, plant hire and apprentice intake against 56,630 as the last full-year commencement print, not against a 60,000 run-rate this year.

2. Do not staff the 80,000-a-year state target. HIA does not expect that target to be met in any single year. Treat it as a political number, not a work-in-hand forecast.

3. Re-run feasibility where established-home pricing has moved. Projects that pencilled when investor willingness-to-pay sat higher may not clear once established and new-home prices move together. Re-check land-bank take-up and option timing before you extend.

4. Keep client conversations on the published Outlook. Link the HIA Victoria release. Do not invent rates, council SLAs, approval odds or testimonials. The factual line is: recovery delayed at least a year; 60,000 Victorian starts not expected until 2028; the 80,000-a-year target is not expected to be hit.

Bottom line for the desk

HIA Victoria says federal housing-tax and SMSF-borrowing changes, plus state land-tax settings, delay the state’s home building recovery at least another year. Victoria built 56,630 homes in 2025; 60,000 is now a 2028 number, and the 80,000-a-year target is not expected to be met in any single year. Recast crew, plant and land bank on that delayed path before the next progress-claim cycle.