The Sunshine Coast has emerged as Queensland’s new hot spot for construction activity, while builders are also confident about the outlook in the Gold Coast, Brisbane and Far North Queensland.

Unveiling the results of its June Quarter Survey of Industry Conditions, the Master Builders Association of Queensland says the Sunshine Coast emerged as the region with the most promising construction outlook, scoring an impressive 70.3 on a scale of 0 to 100 on an index of builder sentiment whereby any score above 50.0 indicates net optimism about the short term future.

Throughout the Sunshine Coast, commercial construction activity has received a massive boost through work on the Sunshine Coast University Hospital, which according to media reports now has more than 10 cranes on site.

A further boost has now been received through the announcement of $440 million worth of road works to upgrade the Mooloolah River Interchange and reduce congestion on the Sunshine Motorway and Nicklin Way – two of the Sunshine Coast’s main arterial roads.

Furthermore, a substantial recovery in residential construction is being underpinned by a significant period of underbuilding, which according to estimates from Australian Construction Industry Forum has seen the number of homes being built throughout the region each year fall short of demand by around 700. This has resulted in the build-up of a cumulative deficit of around 6,000 homes since 2008.

Elsewhere, builders are confident about the outlook in the Gold Coast – where ACIF puts a cumulative shortage of homes at around 30,000 and which is set to benefit from work associated with Commonwealth Games projects – as well as Brisbane, Darling Downs and South West Queensland and Far North Queensland.

construction sentiment

More broadly, overall sentiment within the state’s construction sector dipped slightly in the June quarter but remained at a high level, with reported levels of profitability, work in progress and employment levels all showing signs of improvement albeit with builders reporting limited capacity to increase prices and a slightly below average backlog of work.

Master Builders deputy executive director Paul Bidwell welcomed the latest results, saying they reflected a steady interest rate environment and modest employment growth.

“These latest results represent a significant improvement since our last survey and go hand in hand with improving levels of building approvals and activity,” Bidwell said. “While for many regions of Queensland, the reality of the end of the resources boom continues to be felt, it is still reassuring that confidence appears to be levelling at a relatively high point.”

Key points:

  • Business conditions in both the residential and commercial sector are improving
  • Overall confidence throughout the Queensland building and construction sector is strong
  • Business conditions, profitability and employment are up, but builders are still subject to competitive pricing pressures
  • Builders are most optimistic on the Sunshine Coast, followed by the Gold Coast, Brisbane, Darling Downs and South West Queensland and Far North Queensland.