[Australia'sresidentialconstructionindustryisapproachinglightattheendofadarktunnelconstructionslowingisabouttoendthisyearaccordingtothelatestHousingforecastsIndustryAssociation(HIA)
The industry experienced its largest decline in housing starts last year when housing starts fell from 225,061 to 174,770. This slowdown was one of the reasons for the Global economic downturn, said Tim Reardon, chief economist at HIA.
"Despite this huge contraction, we believe that the cycle has more or less run its course and that the overall housing market reached a turning point at the end of 2019, supported by rate cuts. interest and growth in house prices, "he said.
However, Reardon said it is unlikely that the next upturn in homebuilding activity will reach peaks during the boom years from 2014 to 2018.
There are several reasons why the recovery may not be as stellar as that observed a few years ago: First, the speed at which the population is increasing. As the population steadily increases to less than 400,000 people per year, recent gains have declined from previous peaks.
"This more stable rate of population growth, as well as a large part of the sub-buildings, now largely reduced, means that the pressure for new constructions will not reach the same level of fever", said Reardon.
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Another reason was the credit crunch. Although regulators have since relaxed some restrictions, the tightening of lending standards still affects homeownership rates.
"As a general rule, any drop in homeowner demand for new homes would likely be met by investors, except that this time we would not be counting on the same wave of foreign investment, given the barriers they face with punitive stamp duty rates when entering the domestic housing market. As a result, we expect upward pressure on rents, "said Reardon .
Given these factors, Reardon predicts that construction growth will be a "very modest affair".
HIA figures predict that the current dynamics will affect the construction of several units. During the boom years, starts of several units averaged 105,000 units per year. For this year, 75,750 collective dwellings are expected to start, followed by 77,390 next year and 80,980 by 2022.
With regard to individual housing, housing starts should reach 101,390 this year, 102,750 in 2021 and 104,350 in 2022. These figures are lower than the annual average of 117,000 single-family housing starts during the 2014-2018 boom period.
Reardon said the home building system needs a strong national economy to continue growing.
"Unfortunately, international factors are likely to have an impact on the volume of house construction in Australia in the medium term. The effects of trade and tourism restrictions with China pose a significant downside risk to our As these effects are still emerging, we have not factored them into our forecast, "he said.
A separate report from Master Builders Australia said housing starts for new homes are likely to end in 2020/21 at around 159,000. Housing starts are expected to exceed 200,000 by 2024/25.
"Australia needs about 200,000 new homes to build each year to meet future population growth. Our latest forecast indicates that we will be a long way from that requirement in a few years, "said Shane Garrett, chief economist at Master Builders Australia.
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