Tougher Conditions For Residential Building During September Quarter
â€śThe latest National Survey of Building and Construction shows that residential building activity has entered more challenging waters,â€ť according to Master Builders Australiaâ€™s Chief Economist Shane Garrett.
â€śThe Activity Index for Residential Building fell to 55.0 points in the September 2018 quarter compared with 59.8 points in the previous three-month period,â€ť he said.
â€śLooking forward, optimism has dimmed in the residential building sector with the Surveyâ€™s Expectations Index falling by 1.9 per cent during the September 2018 quarter. This suggests that those in the industry anticipate further weakening over the coming six months,â€ť Shane Garrett said.
â€śResidential building is being hit by tighter finance availability as well as the softening of house prices in Sydney and Melbourne over the past year. These factors are likely to drag new home building lower over the next few years,â€ť he said.
â€śIt has always been a struggle to consistently deliver enough new homes to meet demand. This has resulted in house prices steadily outgrowing wages and incomes over many decades,â€ť Shane Garrett said.
â€śPolicy settings need to ensure that we can build enough new homes to accommodate a growing economy and a larger workforce,â€ť he said.
â€śNewly-released modelling from Cadence Economics confirms that proposed restrictions on negative gearing and CGT would result in up to 42,000 fewer new homes being built over a five-year period â€“ enough to house over 100,000 ordinary Australians,â€ť Shane Garrett said.
â€śThese latest Survey results show that residential building is already cooling. We donâ€™t need to weigh it down even more,â€ť Shane Garrett said.
To access the survey click here.
For further information contact:
Ben Carter, Director Media & Public Affairs, 0447 775 507