Australia’s housing debate is usually framed as a supply problem: we need more homes, faster approvals and greater construction capacity. From an insolvency and restructuring perspective, however, financial distress among large-scale developers and builders can itself weaken housing supply by affecting land values, project finance and market confidence.
When a major residential developer controls multiple development sites and projects within defined geographical areas, insolvency can have consequences beyond that business. If several sites are sold under financial pressure, those transactions can influence comparable land values in the surrounding market.
That matters because valuations underpin development finance. For example, a project carrying $30 million debt against a $50 million valuation has an LVR of 60%. If the valuation falls to $40 million, the LVR rises to 75% without the developer borrowing another dollar.
At the same time, lenders may respond to greater sector risk by reducing acceptable LVRs or requiring more equity. The result can be a reinforcing cycle:
developer distress → weaker land values → higher effective LVRs → refinancing pressure → further insolvency risk.
For an already leveraged developer, a valuation decline can quickly turn a project-level cash-flow issue into a portfolio-wide funding problem.
The consequences extend beyond developers and lenders. In the 2025–26 NSW Budget, transfer duty was forecast to generate approximately $13.36 billion, while land tax was forecast at approximately $8.79 billion.
Transfer duty is directly affected by both property values and transaction volumes. If property prices fall and fewer transactions occur, government revenue also comes under pressure. This is an important policy consideration because the property sector is not only expected to deliver more housing; it also contributes materially to the State’s revenue base.
Australia’s weak housing-construction productivity has rightly attracted attention. The Productivity Commission found that Australia is producing approximately half as many homes per hour worked as in 1995. After adjusting for dwelling size and quality, housing-construction labour productivity has declined around 12%, while economy-wide labour productivity increased approximately 49% over the same period.
But productivity is only part of the issue. Construction costs have risen sharply.
ABS data show the house-construction input price index increased from around 125.0 in June 2021 to 167.8 in June 2026, an increase of more than one-third in five years.
At the height of the construction cost escalation, house-construction input costs increased 17.3% in the year to June 2022.
These increases matter because many projects were acquired, presold or financed under very different feasibility assumptions. Where revenues are effectively fixed via pre-sale contracts, construction costs, interest costs and equity requirements continue to rise, margins can disappear quickly.
Australia cannot solve its housing shortage simply by approving more projects. Those projects must also be commercially viable, financeable and capable of completion.
From an insolvency practitioner’s perspective, the central question is therefore not only: How many homes can Australia approve? It is: Can the industry still finance, build and complete them at current costs?
If declining land values, tighter credit, weak productivity and elevated construction costs are not considered together, insolvencies may become not just a consequence of the housing crisis, but another factor making it worse.
Australia’s retail sector entered 2026 under sustained financial pressure. Although online sales continued to grow, higher operating costs, weak discretionary spending, accumulated tax debt and intense competition pushed a growing number of retailers into insolvency.
Key figures
A growing online market- but not necessarily a profitable one
E-commerce demand remained comparatively strong. Australian online retail sales reached $4.70 billion in June 2025, up 13% year-on-year.
However, sales growth did not automatically translate into stronger profitability. Many online and omnichannel retailers continued to face:
ASIC generally records e-commerce businesses within their underlying retail category, rather than publishing a standalone “e-commerce insolvency” total. Therefore, online retailer failures are largely included within the broader retail figures.
What changed in 2025?
The record insolvency level reflected both current trading conditions and the removal of pandemic-era support. The RBA found that tax payment concessions allowed some struggling businesses to accumulate larger debts. Since 2022, the proportion of insolvent companies owing more than $250,000 in tax increased materially as the ATO resumed stronger recovery activity.
Retailers were particularly exposed because household spending remained cautious while wages, rent, energy, insurance, freight and inventory costs continued to rise. Fashion, homewares, furniture and other discretionary categories were among the most vulnerable.
The liquidation of Mosaic Brands, which operated Rivers, Katies, Millers and Noni B - illustrated these pressures. At its peak, the group operated around 1,400 stores. Its collapse ultimately resulted in more than 700 store closures and almost 3,000 job losses, including 136 Rivers stores and approximately 650 employees in early 2025.
Outlook for 2026
The 2026 outlook is best described as stabilisation at a high level, with retail risk still increasing.
Retailers are being squeezed between subdued consumer demand and elevated input costs. Retail turnover growth has reportedly been forecast to slow from approximately 2.3% in 2025 to 1.8% in 2026, while discretionary spending growth is expected to weaken more sharply.
The businesses most exposed are likely to be those with:
Conclusion
Australia’s retail insolvency problem is no longer simply a post-pandemic correction. The sector is undergoing a structural reset. E-commerce continues to expand, but growth alone is not protecting retailers from failure. In 2026, survival will increasingly depend on cash-flow discipline, profitable customer acquisition, inventory control and early restructuring - not simply higher sales.
The diversity and usefulness of potential Insolvency Appointment tools are often little appreciated.
The below summation covers the majority of potential corporate and personal appointments. For example, the Conveyancing Act in NSW includes provisions which can more readily assist Insolvency Practitioners in setting aside property transactions that may have conferred a disposition of property in favour of a third party. These types of proceedings can often be a more cost-effective recovery process.
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