Dwelling commencements up in 2013

Dwelling commencements up in 2013

Posted on Friday, October 11 2013 at 1:39 PM

New home commencements have risen for the first time in three years, according to the Australian Bureau of Statistics (ABS).

New data released today indicate a gain over the 2012-13 period,
heralding a growing confidence in the property market, Housing Industry
Association chief economist Harley Dale says.

“Dwelling commencements (housing starts) increased by 11.2 per cent in
2012-13, an encouraging recovery following declines of 5.8 per cent and 11.1
per cent in 2010-11 and 2011-12 respectively,” Dale says.

The numbers have broken through an important barrier, he believes.

“A substantial upward revision to the March 2013 quarter contributed to
housing starts surpassing the 160,000 mark in 2012/13, reaching a level of

“That is a healthy figure by recent standards and certainly a promising
first round recovery for new home building.”

The data shows strong gains across most states and territories, with the
exceptions being New South Wales, Victoria and the Northern Territory.

Despite the improved national result, Dale says it wasn’t evenly spread
throughout the 12 months, and a more consistent improvement would be welcome.

“What is less encouraging is that all the growth occurred in the first
half of the year, following which housing starts declined in the March 2013 quarter
and held steady in June.

“We now need to see an acceleration of growth in 2013/14 reflective of a
broad-based recovery in housing starts.

“That outcome will require further upward momentum in New South Wales
and Western Australia, together with a re-emergence of sustained growth in
other markets.”

Improving confidence in the sector, combined with low interest rates, should
bode well for a recovery but regulators need to play their part too, he

“The current regulatory and taxation environment combined with
ever-tightening credit conditions for residential development significantly
dilutes the chances of securing this outcome.”

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