The housing undersupply explained and what it means for buyers

Queensland’s housing undersupply isn’t just a statistic. It means fewer homes to choose from, more competition, and an urgency to act fast. 

Queensland’s housing market isn’t just tight - it’s in a measurable imbalance. The story for you as a buyer is important: fewer homes being delivered, rapid population growth, and inflationary pressure on prices and rents. Understanding this gives you an edge in timing your move, selecting the right product, and positioning yourself for success.

What does “39% undersupply” mean for buyers?

When you hear statements like “Queensland delivered only around 61 % of the homes needed” - meaning a ~39 % shortfall - it reflects that new dwelling completions are lagging household formation (or the number of homes required) in the state. For you, this means:

• Fewer homes are available relative to demand → competition is higher.
• The price floor is elevated because supply isn’t freely satisfying demand.
• New homes (which often cost more to build) may command a premium, but also may offer better value in terms of features or modern design.

Why supply isn’t keeping up and the implications for you

Approvals, capacity & feasibility

The pipeline of homes is constrained by things like slower approvals, high costs of materials and labour, and capacity constraints in construction. For you as a buyer that means that simply waiting for “cheap deals” may not deliver a flood of supply any time soon - the backlog remains.

Strong demand

Queensland’s population is growing, households are forming, and more people are migrating to the state. For you this means that the pressure from other buyers (including investors, interstate migrants) is real - being ready to act counts.

Tight rental and resale market

A tight rental market means many buyers may also consider building or buying new to avoid rental competition or future price rise. Likewise, resale homes may get premium pricing because buyers have fewer choices. As a buyer you should recognise that you’re not just competing for homes - there are fewer available homes for purchase, which can impact negotiation leverage.

What it means for you as a buyer: 5 key take-aways

1. Be decision-ready

Because supply is constrained, being ready with finance, deposit and a clear criteria gives you a competitive edge. If you’re looking at new builds (land + build) or titled lots, you’ll want to act swiftly.

2. Consider new-build or off-the-plan options

Given the undersupply of established stock that’s suitable and move-in ready, new builds offer an alternative: you can secure something tailored (layout, inclusions) and lock in early before price jumps further. The gap in supply supports this strategy.

3. Prioritise location and growth corridors

In an undersupplied market, homes in growth-areas tend to outperform because they align with infrastructure, migration, and liveability. For example, regions on the Sunshine Coast, Gympie fringe or north Brisbane are benefiting from population flows. Buying in an estate or suburb with upcoming amenities gives you the dual benefit of value and potential future upside.

4. Manage timing and expectations

Because supply is constrained, price rises may continue (or at least not decrease) even when interest rates rise - the supply-side keeps a floor under the market. That means if your budget is fixed, you’ll want to:

• Lock in quickly to avoid being priced out.
• Prioritise what matters (layout, location) rather than chasing “perfect”.
• Be realistic that waiting might cost more.

5. Use the undersupply to your advantage

While undersupply means competition, it also means opportunity. Builders and developers are keen to bring product to market; you may benefit from incentives, better inclusions or early-bird deals if you engage at the right time. Being aware of upcoming land releases or new estates puts you ahead of the curve.

How this plays out for first home buyers

If you’re buying your first home, the undersupply environment means:

• The “perfect bargain” on an established home may be harder to find - fewer listings, higher competition.
• New home or land + build options might be more available and allow you to step in without bidding wars.
• Consider lock-in a builder with fixed-price contracts and plans aligned to your budget - this safeguards you from cost-blowout in a market with tight supply.
• Focus not just on price, but on the whole package: affordability, timeline, and value for money. For instance: how quickly can you move in? What are the running costs?
• Actively track upcoming land estate releases or builder display homes, particularly in growth corridors - this is where supply is more forthcoming and you may get better positioning.
  
  

Example strategy for a buyer on the Sunshine Coast or North-Brisbane fringe

1. Get your finance approval sorted and know your maximum budget.
2. Choose a growth-corridor suburb (e.g., Sunshine Coast hinterland, Gympie fringe, north Brisbane release) with upcoming estates.
3. Prioritise a reliable builder with fixed-price, fixed-timeframe offerings - this gives you certainty despite supply pressure.
4. Compare new builds vs established homes: weigh up the time to move in, potential appreciation, and competition risk.
5. Move quickly once you find a release you’re comfortable with: in an undersupplied environment, hesitation can cost you.

Final thoughts

Queensland’s housing undersupply isn’t just a statistic - it’s a buyer-market signal. For you, it means fewer homes to choose from, more competition, and an urgency to act smartly. But it also means opportunity: new builds, land + build pathways, and growth-corridor suburbs offer a way into homeownership when the established market may feel crowded.

By being prepared, understanding the landscape, and prioritising what matters, you can navigate this market with confidence - and secure a home that meets your needs rather than being forced into compromise by limited supply.

Ready to explore new-build options in the Sunshine Coast, Gympie or north Brisbane growth corridors? Let’s talk about timelines, designs and how to maximise your buyer advantage in a market where every choice counts.

Get in touch.