NSW ‘premier state’ for home building
The Housing Industry Association (HIA) has recently announced New South Wales as the ‘premier state’ for home building in Australia.
This comes as a result of the association’s winter 2015 Housing Scorecard. This offers a state-by-state analysis of home building around the country. The scorecard considers 14 key indicators of performance such as the turnover of established homes, renovations, and the construction labour force. Each activity is balanced against long-term averages for each state and territory.
In this year’s report, the NSW home building recovery has helped the state reach the number one spot in Australia for residential buildings. In doing so, the state has knocked off Western Australia from the top spot. Which held the position for several years. Victoria now sits in third place.
HIA economist, Geordon Murray, helped explain NSW’s rise to the top.
“NSW continues to rate highly on indicators measuring levels of multi-unit dwelling construction. But it may be a surprise to some that NSW also rates very highly across indicators of detached house building.”
Murray also explained that residential building has been playing a key role in Australia’s economy after the mining boom. This is helping the eastern states pick up the pace in terms of driving growth.
The weakest point for the state was the activity around first home buyer lending. Out of all states and territories, NSW was the third weakest in this area. This highlights the tough market for first-time buyers. While the First Home Owner Grant (FHOG) in NSW currently sits at $15,000, it only applies to new homes or those looking to build their own home. Also, it is dropping to $10,000 come January 1, 2016.
Furthermore, house prices in Sydney have continued to rise, and have recently seen the median price reach $1 million – a figure that is higher than the average London house. It is according to the Domain House Price report from July 2015.
According to figures from the Australian Bureau of Statistics from June 2015, the total number of dwelling unit approvals in Australia has risen 14.4 percent between June 2014 and 2015. Although this figure has dropped 1.2 percent from May 2015.
However, the ABS highlights that the seasonally adjusted estimate for total dwellings approved in Australia has fallen 8.2 percent in June. That was all after growing 2.3 percent the month before.
Speaking on other states and territories, Mr. Murray also commented that Queensland, which remained unchanged in state rank in sixth place, had “continued to gather momentum”.
“The analysis shows the improvements can be attributed to a boost in multi-unit home building… to maintain the positive momentum we’ll need to see the recovery broaden its base through improvements in attached house building and renovations activity,” he continued.
South Australia and Tasmania followed Queensland in seventh and eighth place respectively. For Tasmania, this marks the tenth quarter in a row in the bottom spot.