Little Joy for Builders Despite Spike in Dwelling Starts
Despite a rise in national dwelling commencements in the June quarter, figures released today by the Australian Bureau of Statistics confirm the housing industry remains in trouble.
While the number of dwelling units commenced rose 4.6 per cent in the June quarter, total starts for the 2011/12 financial year of a little more than 139,000 is down 11.5 per cent on the previous year.
Chief Economist at Master Builders Australia, Peter Jones said the rise in the June figures is cold comfort for builders who continue to face very difficult operating conditions.
“Builders are struggling and with little joy in the forward indicators there is an urgent need for policy action at all levels of Government.
“Further rate cuts from the Reserve Bank are needed to turn consumer pessimism around and ensure that demand recovers.
“Removing policies that work to restrict supply must be a focus for all governments. Policies that prevent the residential building industry meeting the serious undersupply of housing must be addressed. Poor land release strategies and inefficient developer charges should be the first place to start.
“The housing sector has been underbuilding for the past seven years and it is crucial that Australia’s residential building industry now embarks on a major growth phase to overcome the housing shortfall.
“Urgent reform is required to address supply bottlenecks otherwise a strong industry response to meet underlying demand cannot eventuate. This will exacerbate Australia’s housing affordability crisis, increasing rents and house prices as people chase less stock,” Mr Jones concluded.