Geelong home building approvals surge 34pc towards 2022 levels

Geelong’s Armstrong Creek growth area near Marshall. Picture: Alan Barber

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Home building approvals in Geelong are close to levels not seen since the HomeBuilder construction boom during the Covid pandemic.

KPMG analysis of the latest Australian Bureau of Statistics building approvals figures shows the number of new homes approved in Geelong has surged 34 per cent in the past year to August.

The number of new homes in the pipeline now sits at 4000, close to the level last seen in the Covid boom of 2022, reflecting the region’s strong population growth, employment opportunities and lifestyle appeal.

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Geelong’s residential development activity remains heavily concentrated in a handful of high-growth locations, reflecting affordability constraints on homebuyers and the slowdown in apartment construction in the region.

Lara, Charlemont, Armstrong Creek, Mount Duneed and Ocean Grove accounted for around 60 per cent of all dwelling approvals across the region in 2026.

There was also a significant number of approvals at Portarlington, Torquay and Corio in 2026.

KPMG urban economist Terry Rawnsley said while higher construction costs, labour shortages and elevated interest rates weighed on residential building activity, the rise in approvals demonstrates growing confidence in Geelong’s long-term growth story.

KPGM urban economist Terry Rawnsley.

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“Housing supply remains one of the region’s key economic challenges which is why sustained levels of dwelling approvals will be critical to meeting the needs of the a growing population and improving housing affordability over time,” Mr Rawnsley said.

“The focus now needs to be on ensuring approved projects can progress through to construction and completion, so that new housing supply is delivered to the market as quickly as possible.”

The analysis shows the gathering pace of home building shifting to Geelong’s north, with Lara overtaking Armstrong Creek, Charlemont and Mount Duneed to record the highest number of approvals, placing pressure on delivering new community infrastructure.

“New building approvals are concentrating in greenfield development zones where land supply and infrastructure investment make new dwellings more feasible than in inner city locations,” Mr Rawnsley said.

Mr Rawnsley said while Geelong was competitively priced with growth areas such as Melton and Wyndham, it wins in the lifestyle stakes with great beach and work commute access.

Villawood Properties has launched a new display village at its Armstrong Mount Duneed community. The Whites Rd village will host 32 new homes from 19 builders.

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Metricon regional west regional manager Dion Planken said the rise in building activity came off the back of some really strong sales very late last year and early this year, up until March.

But he said cheaper, established properties was now the biggest competitor for the building industry.

“So that built up our pipeline in Geelong, Ballarat and Warrnambool, which is where we operate from here, and we’re still delivering on those site starts.”

Mr Planken said the government affordable housing program also contributed to rise in approvals, along with more medium density dwellings.

“All those things are definitely contributing to the additional building approvals, which is exactly what Geelong needs when you’re growing at 2.2 per cent a year and some of the stronger growth in the country.”

Increasing townhouse construction in the greenfields markets was a sign of affordability pressures on buyers.

“Land prices in Geelong are still relatively expensive and not far away from your outer suburbs in Melbourne,” Mr Planken said.

“We’re finding people that are coming to talk to us want a house and land package somewhere around the $650,000 to $680,000 mark. It really does rely on the land size whether we can support that.”