Half-Yearly SDA Market Wrap: Navigating NDIS Housing Trends in 2025
The NDIS (National Disability Insurance Scheme) plays a critical role in providing Specialist Disability Accommodation (SDA) to eligible participants, ensuring access to safe, appropriate, and high-quality housing options. Every quarter, the NDIS releases a comprehensive dataset, which SDA Data then analyses to provide deeper insights into market trends. This Half-Yearly Wrap offers a state-by-state breakdown of key statistics and highlights the growing complexities within the SDA supply and demand landscape.
Australian SDA Market Overview
Over the past year, the national SDA landscape has shifted dramatically. While the overall number of NDIS participants accessing SDA funding has slightly increased, the utilisation rate remains stagnant at 42%. More notably, there has been a substantial increase in new SDA dwellings and an even more significant rise in rooms under construction.
December 2023: The market faced an undersupply of 2,625 SDA rooms.
June 2024: This undersupply has flipped to an oversupply of 625 rooms, with 13,110 additional rooms under construction.
This rapid increase in supply presents a challenging scenario for investors, as some SDA properties may struggle to achieve expected occupancy rates or returns.
State-by-State Breakdown
Australian Capital Territory (ACT)
While demand and utilisation rates have slightly declined, SDA supply continues to rise. The oversupply has grown from 67 rooms in December 2023 to 89 rooms, with an additional 91 rooms under construction.
New South Wales (NSW)
There has been a modest increase in SDA participants, but utilisation rates remain unchanged. A significant rise in new and under-construction rooms has resulted in an undersupply of 271 rooms, down from 577 in December 2023. However, 2,220 more rooms are under construction, which may tip the balance toward oversupply soon.
Northern Territory (NT)
Despite its small SDA participant base, NT has seen increased uptake of SDA funding. The undersupply has decreased from 132 to 76 rooms, with 157 more under construction.
Queensland (QLD)
SDA participant numbers and utilisation rates have risen steadily, but supply has surged even more. In December 2023, QLD had an undersupply of 460 rooms—this has now shifted to an oversupply of 299 rooms, with a further 2,709 under construction. This signals a critical turning point for investors in the state.
South Australia (SA)
SA has experienced no change in SDA participant numbers and stable utilisation rates. However, the supply of new SDA dwellings has grown significantly. The oversupply has jumped from 521 rooms in December 2023 to 822 rooms, with another 1,459 rooms under construction.
Tasmania (TAS)
Uniquely, Tasmania has seen a substantial decrease in SDA participants, dropping from 592 to 509. Despite this, SDA room supply continues to grow, with an undersupply of 311 rooms (down from 432 in December 2023) and 292 more rooms under construction.
Victoria (VIC)
VIC has a comparatively high SDA utilisation rate (71%) and a steady increase in SDA participants. However, supply has surged—there was an undersupply of 271 rooms in December 2023, but now there is an oversupply of 836 rooms, with 4,586 more rooms under construction.
Western Australia (WA)
WA has seen a slight drop in SDA participants, but its utilisation rate has significantly increased to 28% (still below the national average). Supply growth has been rapid, with an undersupply shrinking from 1,337 to 763 rooms, and 1,596 rooms currently under construction.
Rank Order State By Demand to Supply Ratio (DSR)
It's impossible to analyse every single location in Australia to ascertain where demand is greater than supply for SDA housing (or vice-versa). One method we use is to rank order every location by the ratio of demand to supply for SDA (SDA DSR).
The DSR for SDA tells us how many participants are available for each room and as we can see there is a small oversupply of rooms in each State. NT is has the greater oversupply relative to demand and Victoria has the lowest level of oversupply relative to demand for rooms.
| State | Total Rooms (Supply) | Number of SDA Participants (Demand) | Participants per Room |
|---|---|---|---|
| VIC | 8512 | 7822 | 0.92 |
| QLD | 4832 | 4195 | 0.87 |
| TAS | 666 | 509 | 0.77 |
| ACT | 514 | 334 | 0.65 |
| NSW | 10600 | 7922 | 0.75 |
| WA | 2701 | 1902 | 0.70 |
| SA | 1890 | 1263 | 0.67 |
| NT | 432 | 300 | 0.69 |
Does this mean there is no more opportunities to invest in SDA NDIS housing?
Not at all. It just means you have to dig a bit deeper to find those little pockets where the SDA DSR is greater than 1. Any DSR greater than one means there are more participants looking for rooms than there are rooms available.
The beauty of the DSR is you can target areas with the highest ratio to ensure you are on the right track.
EXPERT TIP!
SDA Data co-invests in SDA housing with our clients. This means we find those locations with the highest relative unmet demand out of a potential 15,000+ suburbs countrywide. We also monitor the trends in the SDA DSR to ensure we see new opportunities before anyone else but also sell down in areas before they become oversupplied by those investors that secretly follow us into those highly desirable and affordable locations. If you want to find out how we do this and how you can do it too: jump onto our next webinar here
The Bigger Picture: Challenges and Opportunities
1. Low Utilisation Rates Limit Demand
The national SDA utilisation rate remains at 42%, indicating that many NDIS participants who qualify for SDA funding are either unaware of their options or face barriers to accessing appropriate housing. Bridging this gap is essential to aligning demand with the increasing supply.
2. Oversupply in Certain Markets
While there are still undersupplied areas within each state, oversupply is becoming a major concern in key locations. Investors should conduct thorough due diligence to avoid areas with excessive competition and focus on regions with sustained demand.
3. Aging Stock & Compliance Issues
Existing SDA dwellings that do not meet new compliance standards need to be replaced more efficiently. While 12,153 new, compliant SDA rooms exist, there are still many older dwellings that may soon be unviable.
4. Investor Risks & Opportunities
The growing oversupply trend poses risks to investors expecting high returns. Those who strategically invest in high-demand, low-supply locations may still perform well, but others may face longer vacancy periods and lower-than-expected yields.
Conclusion: Navigating the SDA Market in 2025
Whilst there are numerous pockets within each state and territory that are undersupplied and will continue to be undersupplied for the foreseeable future, overall there is an oversupply of SDA rooms in every state and territory and quite a significant oversupply in some states.
A large part of the issue is the low utilisation of the SDA component of participant’s funds, which sits nationally at 42%, and the large number of Existing rooms that should be replaced by new and compliant SDA rooms at a much faster rate.
Currently there are 14,688 participants utilising their SDA funding, and there are 12,153 new and compliant SDA rooms, and a further 13,110 rooms under construction, so whilst there will be a number of investors that will do quite nicely from their SDA investment, many will incur much lower returns than anticipated, or will suffer quite substantial losses.
Stay Ahead with Data-Driven Insights
At SDA Data, we provide specialised market analysis to help investors, providers, and stakeholders navigate the SDA housing sector.
For tailored insights and expert guidance, reach out to our team and ensure your investment strategies align with the real-time shifts in NDIS SDA housing demand and supply.
