CommSec has released its quarterly State of the States economic performance report, with Western Australia again rated the strongest performing economy in Australia.
The report attempts to identify how Australia’s states and territories are tracking by analysing eight key indicators: economic growth, retail spending, equipment investment, unemployment, construction work completed, population growth, housing finance and dwelling commencements.
While WA only topped one of the eight indicators - retail spending - the state was ranked second in six other indicators, and fourth on dwelling starts.
In good news for the wider economy, CommSec economist Savanth Sebastian predicted all state and territory economies would lift in the coming quarter, as both consumers and businesses are showing a sustained level of optimism.
“The low interest rate environment is boosting housing construction, while rising wealth levels is supporting confidence and, in turn, spending,” he said.
According to the report, housing finance commitments for November 2013 were up on levels for the previous year in all states and territories except the Northern Territory.
Housing finance is not just a lead indicator for real estate activity and housing construction but is also a useful indicator of activity in the financial sector, according to Mr Sebastian.
The report shows Victoria, Western Australia, New South Wales and the Australian Capital Territory all recorded trend housing finance commitments above decade averages.
Victoria was rated top in terms of this indicator, with the number of housing finance commitments 9.8 per cent above the decade average level and commitments in November 12.6 per cent higher than a year ago.
New South Wales moved up to third spot and showed strong momentum with an increase of 20.4 per cent on the 2012 figures in trend terms, while the ACT dropped from first place to fourth.
The Northern Territory was judged the weakest economy for housing finance, with trend commitments 19.2 per cent lower than its decade average.
The next weakest was Tasmania, with trend commitments down by 20.4 per cent on the decade average, but encouragingly, commitments were up 20.2 per cent on a year ago.