A new Australian Bureau of Statistics report has revealed that new standalone homes in the city were approved at an average rate of 33 new dwellings per month between July last year and February.

The previous financial year, most of which was not subject to pandemic restrictions, saw just 24 new homes approved each month.

Although some factors - such as reduced government subsidies - could slow future growth, the city's builders are confident there is enough backlog to keep them in hot demand.

Wayne Carter Homes owner Wayne Carter said he had "never been so busy".

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"Just about everybody, whether they are builders or tradesmen, are all extremely busy at the moment because of the activity that is burning fiercely in the building industry," he said.

Mr Carter said the main issues that could affect the number of houses being built in Wagga in future years was the availability of land and its price, as well as a shortage of materials and qualified builders.

"Materials are in short supply as they can't make it quick enough and just because there is a rise in demand it doesn't mean the labour will be available; it takes years to train them up," he said.

Independent Wagga property valuer Chris Egan said the number of approvals could rise further as there was no shortage of demand.

"[Home approval] figures could increase substantially; it's not the lack of people wanting to build houses, it's the lack of land that has been released for development," Mr Egan said.

The majority of the new homes were approved in areas that included Wagga's northern suburb of Gobbagombalin and the southern suburb of Lloyd.

Mr Carter said that was no surprise as those areas held the city's available vacant land.

In the eight months to February, there were 260 new standalone homes approved in Wagga but just 39 for others types of dwelling.

Mr Egan said there was "massive" potential for growth in the number of new flats and multi-storey units being built in Wagga, as the city needed to "provide a full array of residential accommodation" to meet the variety of needs of new residents.

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