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Australia’s hot property market has driven the fastest pace of building activity growth in 10 months.

The Performance of Construction Index surged 6.5 points to 53.2 in June, jumping above the 50-point level separating expansion from contraction.

The rebound follows a slowdown in the construction industry in May, according to figures from the Australian Industry Group and Housing Industry Association.

Ai Group head of public policy Peter Burn says there was growth across the board in June, noting solid gains in activity, employment and new orders.

"The residential sub-sectors of house and apartment building were the standout performers," he said.

That's on track to continue in the coming months, with the new orders sub-index returning to growth for the first time in eight months.

Housing Industry Association chief economist Harley Dale said new residential construction remains the powerhouse of the economy.

"At the same time, non-residential construction has some spark to it, but the breadth of recovery is still proving elusive," he said.

While the commercial and engineering construction sub-sectors improved in June, they both recorded a drop in new orders, Mr Burn said.

"(That provides) less cause for optimism about the first quarter of the new financial year," he said.

Meanwhile the construction activity sub-index also rose solidly after falls in four of the past six months, while employment also lifted.

 
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