South Australia has emerged as the nation’s frontrunner in residential construction, with new data showing record levels of building activity and economic contribution. The latest Australian Bureau of Statistics (ABS) figures reveal that in the June 2025 quarter, total construction work rose 1.6 per cent to $4.7 billion — an 8.4 per cent increase through the year.

Most striking is the state’s residential sector, which recorded a 4 per cent rise in the quarter to $1.6 billion. Compared with the same time last year, residential building work has surged 19 per cent — double the rate of the next-best performing state, Western Australia, at 9.5 per cent, and well above the national average of 5.3 per cent.

This performance cements South Australia as the country’s strongest jurisdiction for housing starts and overall construction momentum.

Residential growth powering the economy

The rise in residential construction has become a major driver of South Australia’s economic expansion. While non-residential activity also rose by 4.7 per cent in the quarter to $1 billion, it is the sheer pace of residential growth that is catching attention.

The surge coincides with government initiatives to address housing supply shortages and affordability challenges, including land releases, streamlined planning processes and infrastructure investment under the state’s Housing Roadmap.

Nick Champion, South Australia’s Minister for Housing and Urban Development, said the results are proof that government action is working.

“This Government is doing everything it can to build more homes to address the housing supply crisis, and this data demonstrates our efforts are having a positive impact,” Champion said.

“Through the Housing Roadmap, we are accelerating land releases, streamlining approvals and investing in vital infrastructure to keep this momentum going. It’s particularly encouraging to see residential building work 19 per cent higher than this time last year.”

Builders at the centre of the boom

Industry leaders agree that building and construction has been pivotal to South Australia’s economic resilience and growth. According to Master Builders SA, the sector now employs a record 92,000 South Australians, underpinning nearly $20 billion of annual output.

Will Frogley, CEO of Master Builders SA, emphasised the sector’s wider economic impact.

“In recent years South Australia has consistently had one of the strongest economies in the nation and no sector has been more influential than building and construction,” Frogley said.

“Nearly $20 billion a year is being delivered, and our economic multiplier effect is unmatched. The Malinauskas Government has strongly backed us, and we are delivering.”

Frogley also highlighted that the benefits extend well beyond the building site, with flow-on effects for suppliers, trades, and the broader community.

Why South Australia is outpacing the nation

Several factors are contributing to South Australia’s strong performance in residential construction:

• Policy alignment: The Housing Roadmap has brought together planning reform, infrastructure investment, and housing delivery targets in a cohesive strategy.
• Population growth: While smaller than New South Wales or Victoria, South Australia’s steady population growth and interstate migration have increased demand for new housing.
• Industry confidence: Consistency in government support and market signals has given builders and developers greater confidence to push projects forward.
• Cost pressures elsewhere: Rising costs in eastern states have made Adelaide and surrounding regions comparatively attractive for both home buyers and investors.

Together, these factors have created a market where builders can operate with relative stability compared to other jurisdictions battling approval bottlenecks and higher costs.

The national picture

While South Australia leads in residential growth, construction activity across Australia remains patchy. New South Wales and Victoria continue to grapple with planning delays, affordability issues and insolvencies in the building sector.

Western Australia’s 9.5 per cent annual growth highlights its own momentum, but still falls short of South Australia’s near-20 per cent surge. Queensland, meanwhile, is focused on delivering large-scale infrastructure ahead of the 2032 Olympics, though its residential sector has been more subdued.

For builders nationally, South Australia’s example underscores the importance of coordinated planning, government support, and strong industry-government partnerships.

The Good Builder Take

South Australia’s rise to the top of the construction ladder should be seen as more than a quarterly win. It shows what’s possible when builders, government and industry bodies align behind clear housing goals.

For builders in other states, the lesson is clear: regulatory efficiency and industry confidence are just as important as market demand. South Australia’s success demonstrates that reducing approval red tape and backing builders with infrastructure investment can directly translate into more homes and stronger economic performance.

The challenge now will be maintaining this pace. With affordability still a pressing issue across Australia, South Australia’s momentum could provide a blueprint for how to scale housing delivery without sacrificing quality or sustainability.

Author: TGB Editorial