Home building activity set to fall
Despite falling over the next two years, housing activity is tipped to remain “robust”.
The Housing Industry Association’s (HIA) National Outlook Report has forecast a decline in home building activity for the remainder of the year. The HIA says that the record levels of home building activity reached last year are unlikely to be seen again until the 2020s.
“Solid population growth, very low interest rates and consistent gains in employment do mask some concerning trends with respect to underemployment and decelerating GDP growth," HIA senior economist Shane Garrett said. "Combined with another layer of obstacles to foreign investor participation in the housing market, new home building volumes are set to move downwards over the next couple of years.”
Garrett has said that, while dwelling starts are likely to fall over the coming two years, the annual volume is unlikely to fall below 170,000.
“By any standard, this is still a very robust level of activity,” he said.
The fall in residential building is expected to be driven by the apartment market. Garrett has said that multi-unit construction is likely to fall by 41% from its peak.