Despite a two per cent decline in the September 2013 quarter, the 12 months to September showed a steady recovery, with 163,250 new homes commenced, according to HIA chief economist Doctor Harley Dale.
“Looking past the spike in activity due to the GFC-related stimulus, that is the strongest level recorded since 2004,” he said.
The overall recovery in new dwelling commencements is being driven by NSW and Western Australia, with Queensland also now showing clear signs of improvement.
According to Dr Dale, the recovery primarily comprises 'other dwellings', such as multi-units rather than detached housing.
“Both segments are growing, but annual commencements for detached houses are nine per cent below their 20-year average, while commencements of multi-units are running 35 per cent above their 20-year average,” he said.
“This compositional change has an influence on the extent of the boost that domestic manufacturers and retailers will experience from the new home building recovery,” Dr Dale added.
“Overall, the upward trajectory in new dwelling commencements is still clearly a positive factor for the broader domestic economy.”