The Gillard Government has appointed Robert McClelland to the position of Minister for Housing and Homelessness as part of the shuffle of the Federal Cabinet.

The Housing Industry Association welcomed the appointment, with HIA managing director Shane Goodwin commenting:

"The Gillard Government has today noted the challenge that housing affordability (or the lack thereof) presents and has highlighted its commitment to focussing on this issue.

"Housing is shelter, a necessity of life, and as such is deserving of renewed focus to ensure all Australians have access to an affordable roof over their heads."

He added:

"Creating a ministry which includes 'under one roof' all facets of housing supply across the spectrum of public and social housing, together with private owner-occupier and rental stock is a crucial step towards delivering a successful package of housing supply policy reform and implementation is achieved.

"The Federal Government has a fundamental role to play in leading from the front in ensuring a comprehensive program of reform across all levels of government to reduce the excessive costs to new housing."

"That reform should target the impact of taxation on new housing which can total over 40 per cent of the final home buyer price.

"HIA looks forward to working with Mr McClelland to reinvigorate a policy reform process to boost Australia's new housing supply. Policy reform of Australia's housing supply not only ensures the great Australian dream of home ownership does not continue to slip away, it also bolsters the prospect for healthier productivity growth within the Australian economy," added Goodwin.

Housing finance figures

Meanwhile, housing finance figures for October 2011 presented a mixed bag of results, showing a weaker result for new home lending for both owner occupiers and investors, together with further modest improvement in aggregate lending for first time and trade-up owner occupiers.

HIA chief economist, Harley Dale said: "New home lending appears to have largely flattened out through 2011, but at levels below the decade average," said Harley Dale.

The number of loans for construction fell by 1.8 per cent in October 2011 while loans for the purchase of a new dwelling were flat. The value of loans for investment in new residential dwellings slumped by 26 per cent in October and the moving annual value is languishing at levels over 20 per cent down on pre-GFC peaks.

"It is clear that over the foreseeable future Australia will fall well short of building the number of new homes required for both owner-occupiers and renters. Amidst the growing risks to our economy from the situation in Europe, now is the time to be providing stimulus to the new home building sector while at the same time re-invigorating the housing supply reform process which currently lies dormant," Dale said.