Strong construction future ahead

You’ll likely have a whole range of things on your plate, but it’s worth keeping up with the latest developments in the property market. Something that might interest a lot of homeowners and prospective buyers is the strength of the Australian construction industry at the moment – and this looks set to continue.

Australian Bureau of Statistics’ building approval figures for February have revealed yet another month of record-breaking dwelling approval numbers. January saw the largest number of homes approved on record, and the results from February fell just behind at second place. According to the data, the number of new homes approved over the month rose 1.6 per cent in trend terms, which looks to confirm buyers’ taste for taking out a construction loan.

There were some standout states for the month. New South Wales recorded the largest increase in approvals with a 5.4 per cent jump, which reflects just how strongly the property market is tracking along. Victoria and Queensland were also hot on its heels, posting increases of 2.1 per cent and 1.3 per cent respectively.

There were some disappointing results in the Australian Capital Territory, Northern Territory, Western Australia, South Australia and Tasmania, where the figures show decreases on the previous month. There was also a 3.2 per cent dip in seasonally-adjusted terms across the country, but given the astronomical approval numbers posted in January, the Housing Industry Association (HIA) said this was nothing to be concerned about.

HIA Senior Economist Shane Garrett said the construction industry is chugging along stronger than ever, which is encouraging for those looking to take out a construction loan, or buyers on the hunt for a new mortgage.

“At a time of weak overall domestic demand, new residential construction is acting as a welcome pillar of support,” he said in an April 1 release.

“A steady pipeline of new homes represents the most effective solution to alleviating housing affordability pressures.”

Given that there has been some talk about housing undersupply, these latest figures should come as welcome news.