There is a factor that has been almost entirely absent from Australia’s housing supply debate. The data to quantify it has been publicly available the whole time. What it shows is uncomfortable.

Australia is in the middle of a serious conversation about why it cannot build enough homes. Approvals. Targets. Planning reform. Labour shortages. The cost of building. All of it legitimate, and all of it deserves the attention it receives.

What follows is an attempt to add something from the inside, from the perspective of someone who has spent the last several years running detached residential construction sites on the Mid North Coast of NSW. The argument is focused primarily on that segment of the market across eastern Australia, where the evidence is most direct and the data most granular. Writing in late May 2026, it is an argument that one variable has been consistently underweighted in the supply debate, that publicly available government data allows its impact to be quantified, and that the same data now points toward something worth paying attention to.

 

The variable that equalises everyone

Most things that shape housing supply operate differently depending on the operator. Capability matters, and it shows up in outcomes. A well-run builder navigates cost pressures, manages trades and absorbs regulatory complexity better than a poorly run one.

There is effectively one variable that does not work this way, outside of a government-mandated shutdown.

Weather.

A competent builder with a full order book cannot pour a slab on saturated ground. They cannot frame in sustained rain. The site stops. In that moment, capability and financial strength offer no advantage. Policy levers, cost structures and labour availability all affect the economics of what gets built. Weather determines what physically gets done once a site is running. They are different problems. Only one has largely been missing from the public analysis.

What the east coast has been building through

Between 2020 and 2023, Australia experienced a rare triple La Niña, three consecutive years of above-average rainfall across eastern Australia [1]. Sydney’s Observatory Hill recorded 2,530 millimetres in 2022, 221 per cent of the long-run average and the highest total since records began in 1858 [3]. In the first six months of 2022 alone, only 74 days across Sydney were not affected by rainfall [4]. A further La Niña formed in late 2024 and ran through early 2026.

One major east coast contractor reported losing 40 per cent of its construction days in 2022, against a normal budget of 10 per cent [5]. The Reserve Bank of Australia, in its September 2023 Bulletin on productivity, identified wet weather explicitly as a factor that constrained construction output [6]. That did not come from an industry body making a case for its members. It came from the central bank.

The compounding effect is what makes persistent rain so damaging. A practical example: ground saturated in early July means a slab cannot be poured until late July. The frame trade, booked for the first week of August, has filled that slot elsewhere and cannot return until September. Roofing follows in October instead of August. By the time fitout trades are needed, the schedule has blown out by ten to twelve weeks, none of which is recoverable on a fixed-price contract. Rain stops earthworks. Waterlogged ground stays unusable for days or weeks after the rain clears. Running through all of it is a cost base that accumulates regardless.

Most detached residential builders operating across eastern Australia have not had a sustained dry run since 2019. For those on the Mid North Coast and in rainfall-affected regions of NSW and Queensland, the disruption has been particularly consistent. That is more than six years.

It is worth acknowledging that weather volatility is not exclusively a wet-weather problem. Extreme heat constrains concreting and steel work. Prolonged dry cycles cause reactive soils to shrink and move, creating footing and slab risks that generate their own delays and costs. Bushfire conditions can shut regions entirely. The argument here is not that rain is the only weather variable that affects productivity. It is that the particular sequence Australia experienced from 2020 was prolonged, well-documented, and consistently underweighted in the analysis of why the housing pipeline underperformed.

 

The number that changes how the shortfall should be read

This is the part of the analysis that has received little attention.

The ABS publishes the average time from commencement to completion for new private houses, measured quarterly by state. In September 2019, the last full quarter before the La Niña sequence began, the average new detached house took 2.2 quarters, just under seven months, to complete. By June 2024 that had risen to 3.3 quarters, just under ten months. A 50 per cent increase in average build time, drawn directly from ABS data [8].

At the peak of the national construction pipeline in March 2023, there were 104,315 private new houses under construction, against a pre-pandemic normal of approximately 70,000 [8]. Each of those homes was occupying a construction slot for 1.1 quarters longer than it would have under pre-La Niña conditions, meaning the pipeline was delivering fewer completions per year from the same number of active sites and trades.

Across the three years from late 2021 to mid-2024, the construction-slot occupancy absorbed by extended build durations is equivalent to approximately 163,000 dwellings of throughput capacity. To be precise: this figure measures how much completion throughput was displaced by slower pipeline turnover across the national detached housing stock under construction during that period. It is not a count of homes that would otherwise exist. It is a measure of how much productive capacity the system lost to slower turnover, across all causes of the blowout, not weather alone. It should be read as a pipeline efficiency loss, not a direct supply shortfall.

Read that way, it is still a significant number.

The National Housing Accord targets 1.2 million homes over five years, roughly 240,000 per year. Completions have been running at approximately 170,000 to 175,000. The gap the country is attempting to close is approximately 65,000 to 70,000 homes per year. At the worst point of the blowout, the extended pipeline was consuming productive capacity on a scale comparable to most estimates of the annual housing shortfall. Weather was not the only cause of that blowout. But it was a significant and separately documented contributor that ran through the entire period, and it has not appeared in the policy debate in proportion to its effect.

The second cost, which runs longer than the flood itself

There is a further effect that rarely enters the broader conversation.

When a major flood hits a region, tradespeople scheduled onto new residential construction move to flood repair and remediation. This work is urgent and available immediately, and it absorbs trades for months and often years after the flood itself. A builder whose site was never flooded still cannot sequence trades if those trades are committed to recovery work across the same region.

Lismore demonstrated this at scale. The Wilsons River peaked at 14.4 metres in February 2022, the highest on record [9]. More than 6,000 properties were damaged [10]. Three years later, recovery work was still being contracted [11]. The trades serving the Northern Rivers were not freely available to new residential construction for the duration of that recovery period.

In May 2025, the Manning River at Taree peaked at 6.5 metres, half a metre above a record set in 1929 [12]. More than 700 millimetres fell across the event, more than doubling previous May records [13]. The flood was assessed as exceeding a one-in-500-year average recurrence interval, as documented by Risk Frontiers in its post-event analysis [12].

I am based in Taree. What the data describes above played out in real time across the region. Sites went underwater. Trades moved to repair work. Clients paused. The same absorption dynamic that unfolded in the Northern Rivers from 2022 began repeating on the Mid North Coast from mid-2025, and the region is still working through it.

Both communities sit within the eastern Australian corridor that has historically carried the highest demand for new housing supply. Neither appears on a housing productivity dashboard.

What the models are now indicating

ENSO returned to neutral following the end of the 2025/26 La Niña. The signals have shifted.

NOAA holds an El Niño Watch, with the probability of El Niño emerging assessed at 82 per cent by May to July 2026, and a 96 per cent probability of the event persisting through the northern hemisphere winter of 2026/27 [14]. The WMO noted in April 2026 that climate models are strongly aligned, with confidence in onset described as high [15]. The Bureau of Meteorology’s current outlook shows rainfall likely to be below average across most of New South Wales, Victoria, south-eastern Queensland and parts of South Australia for the June to August 2026 period [16]. It is worth noting that the 2023/24 El Niño was brief and followed almost immediately by La Niña. The current emerging event carries a materially higher probability of persistence.

For an industry that has not had a sustained dry run since 2019, that is not a minor weather update. There are reasonable grounds to expect build times may begin compressing if drier conditions persist. The trade absorption effect of 2022 and 2025 should unwind progressively as flood recovery in affected regions draws down. If those conditions hold, productive capacity consumed by the blowout could gradually return to active output.

A view from inside the industry

Housing supply analysis tends to concentrate on the variables that appear on dashboards and respond to policy levers. Approvals. Completions. Targets set and targets missed. Weather does not appear on a dashboard. The Reserve Bank does not hold a press conference about La Niña.

What the ABS build-time data, the RBA’s Bulletin, and the experience of running sites through this period suggest, taken together, is that a material share of the housing shortfall Australia is attempting to close through policy reform was amplified by the same homes taking 50 per cent longer to move through the construction pipeline than they did before 2020. The contributing factors were multiple. But one of them ran continuously through the entire period, left a measurable trace in the public data, and has received almost no attention in the policy conversation.

The policy conversation matters. The cost problem is real. None of that changes.

But if the models are right, the industry is approaching a weather window it has not had since 2019. Understanding what drove the last six years of underperformance is probably a reasonable starting point for making the most of it.

 

References

[1] Bureau of Meteorology, ENSO history and the 2020/2023 triple La Niña. https://www.bom.gov.au/climate/history/enso/

[2] Huang, A.T., Gillett, Z.E., Taschetto, A.S., Australian Rainfall Increases During Multi-Year La Niña, Geophysical Research Letters, Vol. 51, No. 9, 2024. https://agupubs.onlinelibrary.wiley.com/doi/full/10.1029/2023GL106939

[3] Bureau of Meteorology, Sydney in 2022 — Annual Climate Summary. https://www.bom.gov.au/climate/current/annual/nsw/archive/2022.sydney.shtml Observatory Hill recorded 2,530.0mm in 2022, 221% of the long-run average, highest since records began in 1858.

[4] Newpoint Advisory, How to Weather the Perfect Storm Hitting Construction, October 2022. https://www.newpointadvisory.com/how-to-weather-perfect-storm-hitting-construction/

[5] Property Council of Australia, ‘Wet Weather is the Real Killer’, October 2022. https://www.propertycouncil.com.au/property-australia/wet-weather-is-the-real-killer-construction-delays-ballooning-thanks-to-wet-weather-not-covid Brett Mason, CEO of Built: “We’ve lost 40 per cent of our days to wet weather since last November in Sydney… it usually budgets for 10 per cent.”

[6] Reserve Bank of Australia, Recent Trends in Australian Productivity, Bulletin, September 2023. https://www.rba.gov.au/publications/bulletin/2023/sep/recent-trends-in-australian-productivity.html “Wet weather in Australia also constrained production in [construction].”

[7] Alsharef, A. et al., Weather-Related Construction Delays in a Changing Climate, Sustainability, Vol. 13, No. 5, 2021. https://www.mdpi.com/2071-1050/13/5/2861

[8] Australian Bureau of Statistics, Home Building Through the Pandemic, November 2024. https://www.abs.gov.au/articles/home-building-through-pandemic Average completion time rose 50% from 2.2 quarters (September 2019) to 3.3 quarters (June 2024). Pipeline peaked at 104,315 in March 2023, against a pre-pandemic normal of 70,306 in June 2018.

[9] The Echo (Northern Rivers), As Lismore Slowly Repairs It’s Preparing for Higher Floods, February 2023. https://www.echo.net.au/2023/02/as-lismore-slowly-repairs-its-preparing-for-higher-floods-under-climate-change/

[10] NSW Government, Lismore Flood Recovery Planning Package. https://www.planning.nsw.gov.au/policy-and-legislation/resilience-and-natural-hazard-risk/flooding/lismore-flood-recovery-planning-package

[11] Lismore App, 1000 Days After February 2022, November 2024. https://lismoreapp.com.au/NewsStory/1000-days-after-february-2022-what-have-we-achieved/674036145f98ca002e3f69c3

[12] Risk Frontiers, NSW Mid North Coast Flood Impact and Resilience Research, August 2025. https://riskfrontiers.com/insights/flood-impact-community-resilience-research-june-2025/ Manning River peaked at 6.5m, half a metre above the 1929 record. Flood assessed as exceeding a 1-in-500-year average recurrence interval.

[13] Risk Frontiers, May 2025 NSW Mid North Coast Flooding, June 2025. https://riskfrontiers.com/insights/nsw-mid-north-coast-flooding-may-2025/ Taree and Wingham received more than 700mm, more than doubling previous May records.

[14] NOAA Climate Prediction Center, ENSO Diagnostic Discussion, May 14, 2026. https://www.cpc.ncep.noaa.gov/products/analysis_monitoring/enso_advisory/ensodisc.shtml 82% probability of El Niño emerging May to July 2026; 96% probability of persisting through northern hemisphere winter 2026/27.

[15] World Meteorological Organization, WMO: Likelihood Increases of El Niño, April 2026. https://wmo.int/media/news/wmo-likelihood-increases-of-el-nino

[16] Bureau of Meteorology, Rainfall and Temperature Long-Range Forecasts, April/May 2026. https://www.bom.gov.au/climate/ahead/outlooks/