A bounce in residential construction activity in Queensland, Victoria and South Australia has led a surge in housing starts throughout Australia, albeit with a leading economist stressing caution should be observed in calling a recovery in the latter two states.
In its latest report, the Australian Bureau of Statistics estimated that on a seasonally adjusted basis, the overall number of housing construction starts in Australia jumped 8.2 percent in the December quarter last year to come in at 44,729 – the highest level on record since the June quarter of 2009.
The result came as the overall dollar value of building and engineering construction work done eased back 0.87 percent to come in at $41.2 billion, with modest falls registered across each of the sectors.
Leading the housing start surge was South Australia, Queensland and Victoria, where starts rose by 25.21 percent, 15.77 percent and 11.34 percent respectively.
Housing Industry Association Economist Geordan Murray welcomed the latest data but cautioned about reading too much into the numbers of and South Australia – the former of which saw a spike in multi-residential Murray says is unlikely to be repeated and the latter of which is showing signs of momentum but whose results may be being skewed by a pull forward effect associated with the end of the state government’s Housing Construction Grant.
“Based on the levels of activity they’ve had in the last few years, I would be very hesitant to extrapolate this quarterly result into a turnaround in the market in Victoria,” Murray told Sourceable.
“Queensland has the potential to be the biggest driver of the recovery in terms of it being such a large market coming from such a low level of activity.”
In other states, starts rose modestly (2.76 percent) in New South Wales and remained high in Western Australia but plummeted to twelve year lows in Tasmania, dropped by 26 percent from high levels in the Northern Territory and dropped 13.75 percent in the ACT.
The latest figures followed earlier data this month showing indicators such as new home sales, building approvals and housing finance all pointing to a positive outlook for the industry.