Technology in Construction is Now a Reality, with Drones Leading the Charge
Building Up To Smart Skyscrapers
The Big Renewable Projects You Should Know About
NSW's New Construction Plan Calls for Transparency and Collaboration
Can Affordable Housing Even Out Construction Cycle?
How to Gain Leads and Get Ahead of the Competition
How Digital Drawings Are Transforming Construction
The New Green Toolkit — What You Need to Know
August 21, 2017
According to the latest update from the Ai Group/Housing Industry Association Australian Performance of Construction Index (Australian PCI) the industry continues to expand, with the results showing the fastest pace of overall industry growth since the survey began in 2005.
Commercial construction and house building in particular were earmarked as key drivers of growth in July. Whilst commercial construction saw the highest rate of expansion in twelve years, house building has recorded the fastest pace of growth in three and a half years.
However, recent reports have suggested a dampening in residential construction with many onlookers arguing that we have past the peak and can expect a rapid downturn in both housebuilding and apartment building within the next twelve months.
Indeed, the latest Building in Australia forecast from BIS Oxford Economics has forecast the number of dwelling build starts will drop from a peak of 230,000 down to 160,000 within three years. The decline only looks worse if you consider the high-rise apartment sector, which is expected to slump by almost 50 per cent.
Number of new dwelling commencements, source: ABS, BIS Oxford Economics
Jobsite spoke to Malcolm Gunning, Director and President of the Real Estate Institute of Australia, in an exclusive interview to hear about what they’re seeing from both an agent’s perspective, and from their insight into the level of approvals being lodged at the start of the process.
“With any sort of development there is a twelve-month lag. The number of new properties hitting the market now is the result of a pipeline that takes up to three years from approval to completion. It takes time for a battle ship to change direction, it can’t do it immediately.”
“We expect to see the figures start to head south around later this year,” Mr Gunning said.
Mr Gunning pointed to stagnation and decline in the number of development approvals as an indication that the current state of expansion in residential construction is set to change in the near future.
Whilst Australian building approvals picked up in June, they remain down compared to the previous year. According to the ABS, the new building approvals in June were down 14.9% on June 2016, standing at 17,463.
According to Mr Gunning, a key factor in the recent decline in approvals is the change in lending rules, shifting the level of investment being poured into residential construction. Indeed, increased restrictions imposed by the Australian Prudential Regulation Authority (APRA) have been seen to limit the level of foreign investment, in addition to stricter lending practices having an impact on local investors.
“The development approvals, particularly in Sydney and Melbourne, have been significantly less over the last few years and this is down to tighter lending rules”, Mr Gunning said.
Housing Skills Shortage will Impact Home Building in Australia Warns HIA
When life is so busy, it can be easy to get into an unhealthy routine. Here are 11 easy ways to break up your routine and live a healthier, happier life…#1 Make your lunches for the entire week…on ... Read More
Maintaining a streamlined and efficient workflow is one of the primary goals of any construction firm. However, whether due to a lack of skilled la... Read More
Budget. Schedule. Quality. The trifecta of a project. But balancing that trifecta isn't easy to do. Our webinar, led by construction industry exper... Read More
Tim Kelly, S&P Technical Services Manager, looked at numerous document management systems, including EADOC and "probably 10 other systems." What bo... Read More
Workplace safety is a front-of-mind concern for any responsible construction company. Strict adherence and compliance with safety training regulati... Read More
Any construction company will have lots of data sloshing around, and many still rely on archaic methods of logging, filing and using that data, typ... Read More
May 14, 2018
The construction industry is on the rebound after the Great Recession and spending is at an all-time high. In November, investment in new projects ... Read More
May 21, 2018