HAVE WE PEAKED?

HAVE WE PEAKED?
FRESH reports from the Housing Industry Association (HIA) could suggest a turning point in a peaking housing market.

Following its quarterly state-by-state reports released this week, the HIA has posed a key question whether the most recent decline in approvals is the beginning of a broader trend, or it's just an aberration to continuing growth.

Total new home building approvals across the nation have trended down 4.8 per cent in the June quarter this year compared to the year prior.

This comes after news Australians started on building more new homes in the year to March 2015 than in any other twelve month period on record. The total figure was 204,096 from a population of 23 million people.

In fact, the three months to March 2015 reflected particularly high times - 'easily' a record quarterly level of 57,000 dwellings were approved.

New dwelling commencements are now expected to decline sharply, 11.5 per cent in 2016 and 5.8 per cent in 2016/17.

"The current housing cycle is characterised by markedly different conditions across state and territory borders," reports the HIA.

"The near-recessionary conditions afflicting the home building markets in Tasmania and South Australia provide an obvious contrast to the buoyant conditions in NSW and Victoria.

"Meanwhile, the investment cycle of the resource sector is playing a pivotal role in conditions in Western Australia, Queensland and the Northern Territory.

"Finally, the housing market in the ACT has been affected by the dynamics of federal politics over the last five years."

The HIA admits that it speculated approvals had peaked this time last year, however, at that time it noted the possible occurrence of a second wind due to factors such as record-low interest rates.

This wind did sweep the industry - and now, it's not so likely interest rates can keep dramatically falling.

The HIA is standing by its previous estimate that the cash rate will remain at 2 per cent before starting to increase during the second half of 2016.


Help us deliver quality journalism to you.
As a free and independent news site providing daily updates
during a period of unprecedented challenges for businesses everywhere
we call on your support

How communications technology can raise the bar on customer service, employee experience
Partner Content
From capturing feedback early to providing messages with a higher rate of cut-through, ...
Advertisement

Related Stories

Dexus awards John Holland building contract in $2.1b Waterfront Brisbane project

Dexus awards John Holland building contract in $2.1b Waterfront Brisbane project

After securing an $830 million contract from Dexus (ASX: DXS), Melb...

Commercial tower at Sydney’s Green Square receives development approval

Commercial tower at Sydney’s Green Square receives development approval

A commercial tower designed with the changing nature of work in min...

Administrators proffer alternative to liquidation for Probuild parent

Administrators proffer alternative to liquidation for Probuild parent

A Deed of Company Arrangement (DOCA) is the preferred way forward f...

Keylin, Kinstone Group reveal plans for $1.5 billion hospital and health precinct in Coomera

Keylin, Kinstone Group reveal plans for $1.5 billion hospital and health precinct in Coomera

Two Queensland-based developers have teamed up to deliver a $1.5 bi...