The pace of construction in Australia is set to pick up over the coming two years as a growing number of existing home owners join first home buyers in purchasing new dwellings.
According to the Housing Industry Association’s (HIA) national outlook report, the number of new home starts is set to increase by more than 20 per cent.
“The reasons for the recovery are well known -- low interest rates, first home incentives, and a massive boost for social housing. And with consumers feeling more confident about job security and the general economy, new home building and renovation activity will benefit,” HIA chief economist Harley Dale said.
“There are early signs of trade-up buyers returning to the market. But to date, investors have tended to do more selling than buying.”
According to Mr Dale, lending commitments to build new houses have increased by approximately 60 per cent since October 2008.
Similarly, local government permits to build new houses have also risen – climbing 20 per cent over the last year.
“On a regional basis, the biggest gains in home building are expected in New South Wales (from an extremely low base), followed by Victoria and Western Australia,” Mr Dale said.