While aggregate activity in the housing sector in Australia is likely at or near its peak, it appears strong conditions in the market for new housing construction are set to continue for some time and the market for home renovations is likely to improve from a low base.

By any measure, the current market for new residential construction is running hot. Despite having cooled, approvals for new houses and apartments are still running at around 15,000 per month, implying an annual building rate of 180,000 new dwellings that has only ever been achieved once in around 30 years…