Uneven construction markets across the country pose a challenge for policy makers, says the Housing Industry Association.
The Housing Industry Association’s bi-annual Housing Scorecard reveals Victoria’s construction and renovations markets are the strongest in the country.
The report analyses of the performance of the residential building sector in each state and territory, and ranks each region’s performance.
“There were over 220,000 dwellings commenced in Australia during 2015 – a new annual record,” said HIA Economist, Geordan Murray. “However, there were significant divergences in conditions for residential building around the country. The eastern seaboard states have been the strongest performers, the mining states are sliding down the order, while South Australia and Tasmania are facing the most challenging conditions.”
“There is little to separate the top two ranked states, but it is Victoria that has edged out New South Wales to take the top spot. With nearly 70,000 dwellings commenced in 2015, it is not all that surprising that Victoria was number one, but Victoria also ranked as the strongest market for renovations,” said Murray.
“Western Australia is off the pace of the top two states, but still ranks third. The high ranking for WA belies the challenging conditions emerging for residential building, as evidenced by nearly eighteen months of falling home prices. The state’s overall ranking is propped up by strong performances in indicators of residential building that is already underway,” he said.
Murray said Queensland’s recovery is being tempered by the downturn in the mining and LNG sectors. “While residential building conditions have improved in the south eastern corner of the state, the key regional markets to the north - which were leveraged to the mining and LNG projects - are now feeling the pinch,” he said.
“Tasmania and South Australia round out the league table ranking seventh and eighth, respectively,” said Murray, adding that a recovery is underway in Tasmania, from a low base, and that conditions in South Australia are weak, and the outlook gloomy.
“Disparities across housing markets represent a substantial challenge for policy makers,” concluded Murray.
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