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Industry leaders discuss construction reform, investment, and innovation in response to Australia’s housing shortfall.
A new episode of CBRE’s Talking Property podcast delves into the practical and policy challenges holding back housing delivery in Australia—and the role prefabrication, design efficiency and new housing formats could play in shifting the equation. The discussion features Mirvac CEO Development Stuart Penklis and Building 4.0 CRC CEO Professor Mathew Aitchison, both of whom appeared on the innovation panel at the Property Council of Australia’s recent National Housing Solutions Summit. (credit image: Saltair Modular.)
Hosted by Kathryn House, the podcast explores how Australia can meet its target of 1.2 million new homes over five years by drawing on lessons from overseas, improving investment conditions, and applying construction innovation across the housing lifecycle.
Prefabrication shows time and waste savings
A significant portion of the conversation centres on prefabrication. Penklis points to Mirvac’s Georges Cove development in south-western Sydney, where prefabricated housing components reduced construction timelines and onsite waste. “We saw a 54% reduction in time to lock-up and around 60% less waste,” he said. “Buyers couldn’t tell the difference in quality between prefab and traditionally built homes.”
While Australia’s adoption of prefabrication remains limited, Aitchison notes that countries like Sweden and the UK have spent decades developing the necessary supply chains and institutional support. “It’s a long game,” he said. “We lack the long-term national policy framework that would make large-scale implementation viable.”
Misconceptions still linger
Both panellists agreed that public understanding of prefabrication remains a barrier. Aitchison highlighted that prefab is often associated with demountables or mining accommodation, rather than with high-quality housing. He suggested using more accurate terms such as MMC (Modern Methods of Construction) or DFMA (Design for Manufacture and Assembly), and advocated for broader thinking around “industrialised building” as a lifecycle approach that spans design, delivery, and maintenance.
Standardisation without compromise
Penklis discussed Mirvac’s focus on design standardisation to improve procurement and product quality, noting the company has reduced its number of window types to secure higher-performing materials at scale. “We’re pursuing standardisation where it makes sense—not to reduce design quality, but to enable better outcomes for customers.”
This mirrors a theme raised by fellow panellist Sarah Kay, CEO of Woods Bagot, at the Housing Summit: that Australian housing is often over-amenitised. The episode touches on ideas from the UK’s Naked House model—homes built without kitchens or wardrobes so buyers can install affordable versions later—though both guests noted such options suit only a narrow market. The focus, they argued, should remain on building solutions that suit the “80% in the middle.”
Land lease housing and build-to-rent gain ground
The podcast also explores housing types that remain underrepresented in government planning. Penklis cites Mirvac’s investment in land lease operator Serenitas as part of its commitment to the housing continuum. Land lease housing—where residents own their dwelling but lease the land—is gaining popularity among downsizers and retirees. Yet despite over 50,000 land lease homes in the pipeline, the sector is largely unaccounted for in federal and state housing strategies.
“It’s an emerging asset class,” Penklis said. “Like build-to-rent five years ago, it hasn’t yet been properly recognised by government, but investor interest is growing rapidly.”
Calls for coordinated innovation strategy
A recurring theme in the episode is the lack of national coordination around innovation. Aitchison advocates for the establishment of a Research and Development Corporation for construction, modelled on those in agriculture. “Agriculture has 15 R&D bodies and makes up 3% of GDP. Property and construction is 13%, and we don’t have a single one,” he said.
Penklis echoed this, describing Mirvac’s own internal investment in prefabrication capability, and a study tour of remote mining operations in Western Australia that reinforced the importance of innovation. “If Rio Tinto can operate machinery from 1,500 kilometres away, it shows what’s possible in adjacent industries. That’s the mindset we need.”
Policy clarity needed to attract capital
Investment settings were another area of focus. Penklis noted that foreign capital is increasingly flowing into Australian housing—particularly from Japanese investors familiar with prefab—but domestic superannuation funds remain hesitant. Aitchison pointed to the scale of Australian super funds and the opportunity they represent. “By 2030, they’ll be the second largest sovereign investment group globally,” he said. “But we need to create investable products that meet their requirements.”
CBRE’s Andrew Purdon, who was also a keynote speaker at the summit, later posted that Australia must separate the politics of home ownership from the capital frameworks needed to support supply.
Next steps for the sector
Both speakers agreed that more streamlined design, consistent regulation, and greater standardisation across components will be key to increasing supply. But equally important, they argued, is building public confidence in newer construction methods and creating the right conditions for global and local investment to support their growth.
Source: CBRE
