Reducing red tape around building houses the only way towards 'substantive change', Productivity Commission finds

Through protests, pandemics, and supply and skill shortages, obstruction of construction has made building houses in Australia harder.

Local, state, and federal governments are being urged to reduce red tape around housing construction by a new report from the Productivity Commission.

It says the move would speed up planning and approval processes, encourage innovation like pre-fabricated housing, and target trades with training and migration.

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"The reality is they have had those conversations - we have not seen substantive change," Master Builders chief executive Deneta Wawn told 9News.

The company, which acts as the premier association for the building and construction industry across each state, has launched their own in-school program encouraging students into trades.

"40 odd trades can be involved in one house and if you don't have them all coming in at the right time one after the other than you will lose time and time is money," said Wawn.

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The building industry faced several blows last year, including an investigation by 60 Minutes and the Sydney Morning Herald into alleged corruption, intimidation, and links to criminal gangs within the CFMEU's construction division.

Shortly after, the federal government announced its decision to put the construction branch of the Construction, Forestry and Maritime Employees Union (CFMEU) into administration, with workers striking in protest across the country.

Removing red tape to allow more houses built would mean more houses to buy, as seemingly everyone eyes the reserve bank ahead of a rate decision tomorrow.

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To help, the property council is tonight calling for interest rates to be capped for first home buyers, as well as lower deposits.

"It's the perfect first step in a market that really does need the attention of both sides of the parliament," Property Council chief executive Mike Zorbas said.

But as of now, neither side is considering it.