New data shows Anthony Albanese’s housing target is set to become another broken promise – as Australia’s housing crisis takes a back seat to data centre boom
Australia's government target to build 1.2 million homes within five years is increasingly likely to become another broken promise from Prime Minister Anthony Albanese, despite recent improvements in housing construction activity. By the end of June 2026—two years into the National Housing Accord launched in July 2024—Australia had completed only 355,817 dwellings when 480,000 were needed to stay on track, falling 124,183 homes short. Industry groups have warned the target is very unlikely to be met, adding it to Albanese's list of unfulfilled pledges alongside previous tax commitments.
Whilst building activity is strengthening with 47,168 homes completed in the June quarter and 248,733 dwellings under construction at a record high, construction experts forecast Australia will fall short by approximately 262,000 homes. A significant obstacle is intense competition from Australia's surging data centre sector, which is siphoning construction workers and materials away from residential building. Data centre investment pipelines have grown four-fold in a year and now account for 2.5 per cent of GDP, with a total feasible pipeline estimated at £220 billion, whilst falling house prices and policy changes are expected to further dampen housing investment.
- Australia likely to miss 1.2m homes target with projected shortfall of 262,000
- Data centre sector competing for construction workers and materials needed for housing
- Housing construction is rising but remains too slow to meet the accord's target
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In 2024, Australia's government set an ambitious goal: to build 1.2 million new homes over five years through the National Housing Accord. This was intended to address Australia's severe housing shortage, where demand for homes far exceeds supply, pushing prices upward and making homeownership increasingly difficult for many Australians.
Progress has fallen significantly behind schedule. By mid-2026, approximately 356,000 homes had been completed when 480,000 were needed to stay on track. At the current pace, Australia is projected to fall roughly 262,000 homes short of the target.
Australia's data centre sector is competing for the same construction resources needed for housing. These facilities provide computing infrastructure for internet and cloud services, and they have attracted substantial investment from developers and construction companies. Workers and building materials are increasingly being allocated to data centre projects rather than residential construction.
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The strongest fair case each way — we don't pick a winner.
The case for
The government is only two years into a five-year commitment, and construction activity is strengthening with record numbers of dwellings under construction and accelerating completion rates in recent quarters, indicating that momentum is building. With three years remaining and housing construction typically accelerating through a programme cycle, a current shortfall does not necessarily signal final failure; the substantial pipeline under construction suggests higher delivery rates are achievable as the programme matures.
The case against
The government has already fallen 124,000 homes short at the two-year mark despite recent acceleration, and industry experts forecast a final shortfall of approximately 262,000 homes, indicating the 1.2 million target is increasingly unattainable. Competition from the data centre sector for construction workers and materials diverts resources from residential housing precisely when Australia faces an acute housing crisis; this failure adds to Prime Minister Albanese's pattern of unfulfilled commitments and raises questions about governmental credibility on housing.