Coalition Plan to Shrink Building Code and Slash Home Costs

Shadow housing minister Andrew Bragg proposes cutting Australia's 2,000-page building code to 80 pages to reduce new-home costs by up to $33,000.

Building codes rarely make headlines — but they have a direct impact on what new homes cost and, by extension, how much you need to borrow. The Adviser reports that shadow housing minister Andrew Bragg has proposed a dramatic simplification of Australia's National Construction Code (NCC), reducing it from more than 2,000 pages to just 80.

Speaking at the National Press Club on Wednesday 12 August, the Liberal senator outlined his proposed "Basic Australian Standard" — a slimmed-down code that would retain only core health, structural, and fire-safety requirements as mandatory.

"We have recommended a 'Basic Australian Standard' focusing on the core elements with safety as the basis. Everything else is optional," Bragg said. "It establishes essential structural, fire safety, and health-related building standards, in a cost-effective way. Anything else like mandatory ramps, flattened shower flooring or reinforced walls would be optional extras."

What the Code Is Actually Costing Builders — and Borrowers

The NCC was first established in 1988 and has expanded significantly through successive governments. Bragg cited evidence from a recent Senate inquiry into productivity showing that changes to the code over the past seven years had added between $3,600 and $33,000 to the cost of building a new house.

To put that in mortgage terms: an extra $25,000 on a $500,000 construction loan, over a 30-year term, adds meaningfully to monthly repayments. Over the life of the loan, that compliance premium compounds into a significant sum — and it's a cost that borrowers typically absorb without knowing it's there.

Bragg's central argument is pointed: "It is now illegal to build a cheap house in Australia."

He also tied code reform to a broader supply agenda, calling for greater adoption of faster and more standardised construction approaches. "We also recommended wider use of Modern Methods of Construction and a new federal pattern book to drive faster building outcomes," he said.

The Housing Industry Association welcomed the debate but urged caution about removing requirements wholesale. HIA CEO for industry and policy Simon Croft said simplification should not come at the expense of core safety protections.

"The HIA has been saying for some time that the NCC needs a knock-down rebuild, not another renovation," Croft said. He added that the real concern was the "seemingly endless escalation of new requirements being added to the NCC and the growing tendency to use the building code to pursue broader policy objectives."

Croft's view is that the page count matters less than the principle: "Whether the final residential code is 80 pages, 100 pages or another number is ultimately less important than the principle behind the proposal. Australia needs a building code that protects the standards Australians rightly expect from their homes without continually adding new layers of regulation, cost and complexity."

Where the Government Stands

The federal government's response was pointed but acknowledged the underlying problem. Treasurer Jim Chalmers, speaking on ABC Radio on Wednesday, said the government had been working on the issue before Bragg's announcement.

"Andrew Bragg is a bit late to the party on this; we have been very clear that the code is too hard to navigate and it's too costly, and we're making it easier and faster to build by pausing the code and working with the states and the industry to streamline it," Chalmers said.

The government announced a freeze on additions to the NCC last year. Housing Minister Clare O'Neil has met with industry representatives on about 30 occasions over the past year, and a final plan is expected to go to building ministers later in 2026.

So both sides of politics now agree the code is a problem — rare common ground. They differ on scale: the Coalition proposes cutting to 80 pages, while the government is pursuing incremental simplification without a defined page target.

Bragg also used his speech to criticise the federal government's 5 per cent deposit scheme, describing it as uncapped and non-means-tested. The scheme allows eligible buyers to purchase with a 5% deposit without paying lenders mortgage insurance — a genuine cost saving for those who qualify. Whether expanding eligibility beyond the original parameters inflates prices at the entry end of the market is a question economists continue to debate.

What This Means for People Planning to Build or Buy New

If you're planning to build, these proposals won't affect your current construction quote — regulatory change takes time to flow through to builders' pricing. But the direction of travel matters: both sides of politics are now competing to reduce the regulatory burden on new construction, which signals that building costs could ease over the medium term.

For first home buyers, any reduction in new-home construction costs directly expands the pool of affordable properties and can reduce the deposit and loan size required. If you're weighing up whether building versus buying established makes more financial sense for your situation, use our borrowing power calculator to model both scenarios with current rates.

If you're buying new or off-the-plan and your lender is requiring lenders mortgage insurance, our LMI calculator can show you exactly what that premium costs at different deposit levels — and at what point it disappears from the equation entirely.

For borrowers who built in the last two to three years and haven't reviewed their rate since construction settled, this is a good time to compare refinance options. Construction loans often sit at rates above standard variable products, and the savings from switching can be significant.

Comparing today's cheapest home loan rates across both fixed and variable products is a straightforward step that costs nothing and can materially reduce your cost of borrowing.