Small home builders throughout Australia are getting busier despite COVID-19, new data suggests.

Releasing its latest report, cloud based residential construction software provider Buildxact says the volume of quotes on its platform increased from 12,779 in the June quarter last year to 25,900 in the quarter just passed.

Granted, much of the increase reflects growth in the number of builders using the company’s platform.

Stripping out this effect, however, the average volume of quotes for each builder increased by 10.7 percent year on year.

Moreover, volumes have risen since COVID began.

Between the month of March and that of June, the number of quotes on Buildxact’s platform increased by 28 percent.

Whilst the platform’s subscriber numbers increased by 17 percent during that time, this figure still indicates that volumes are rising.

Whilst quoting volumes fell in April, the report says volumes picked in in May and June and are now above March levels.

Moreover, the value of quotes reported on the platform almost doubled from $2.019 billion in the June quarter 2019 to $4.01 billion in the quarter just passed.

Whilst part of this reflects growth in the platform, Buildxact says much of the increase is being driven by greater demand.

Moreover, quote volumes have risen since the announcement of the Commonwealth HomeBuilder package in early June.

Between June and July, quotes on Buildxact grew by 11 percent.

Profit margins, too, are holding up.

Whilst the data shows that margins fell to 12.4 percent in June, prior to that they had held steady at between 13 percent and 14 percent.

Still with ‘win rates’ having declined from 22.05 percent in June 2019 to 14.5 percent in June this year, there are signs that the market is becoming more competitive.

Buildxact chief executive officer David Murray said a previously anticipated decline in quotes upon the onset of COVID has not eventuated.

One possibility, he said, is that people are spending more time at home and thinking more about renovations or knockdown rebuilds.

“Buildxact’s data indicates there has been a major increase in quoting activity by the small residential builder since the COVID-19 restrictions began in March,” Murray said.

“The volume of quotes by small builders has increased and margins are steady, which makes for a relatively upbeat outlook for the residential builder.

“Our data shows that demand has not dropped off over the reporting period. Builders are still quoting work. The volume of quotes in June 2020 was up more than 25 percent (actual: percent) compared to the volume of quotes in March 2020, and total quote values rose by 29 percent (June versus March). While our subscriber numbers have grown also during that period, it would not account for that much of an increase, which tells us there is still a lot of demand out there.”

Buildxact CEO David Murray

Leigh Wallis, Managing Director of Smith and Sons Renovations, a franchise of 86 small builders across Australia and New Zealand, agrees.

According to Wallis, renovations enquiries took off around mid-April.

Whilst some were ‘tyre-kicking’, others are ‘stuck at home and are looking at their four walls, wondering, ‘What can we do to improve the home?’

As well, Wallis says some people may have called tradies after having unsuccessful DIY renovation attempts whilst others may have reallocated money previously earmarked for travel toward home renovation.

He says the home building sector has held up well during COVID-19 compared with other sectors.

Should Australia avoid a further resurgence of COVID-19, he says the sector should pull through.

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