Qld housing recovery finally underway

A report released this week by the peak body for the development and construction industry shows a long-awaited recovery of the local housing sector may finally be here.

22.3.12
The Urban Development Institute of Australia (Qld) Development and Construction Industry Performance Report graphs increases in building approvals and lending over the past three months of available data.

UDIA Director of Policy and Economic Research, Duncan Maclaine, said these leading industry indicators have grown at a faster rate than any other state.

"It's been a promising start to 2012, with private sector dwelling approvals and owner-occupier lending both up in the January quarter," Mr Maclaine said.

"The numbers of registrations of residential vacant lots are also starting to rise after hitting historical lows in early 2011," he said.

Total private sector dwelling approvals were up 5.7 per cent in the January quarter across Queensland and up 17.5 per cent in the core detached dwelling sector.

Owner Occupier lending for new homes increased 5.8 per cent, while lending for established homes grew at a slower 1.6 per cent.

"It is, however, important to bear in mind that Queensland is growing off an historically low base and Queensland remains in the deepest slump of any State," Mr Maclaine said.

"The recovery also remains patchy, with strength building in the resource regions and Brisbane but weakness remaining in markets such as the Gold, Sunshine and Fraser Coasts."

While building activity is picking up, unemployment figures are yet to reflect the improved conditions. Full-time construction employment is still sitting 7.2 per cent below the February 2011 levels.

"The development industry is inherently cyclical, however the recent downturn has been deeper and longer than it could have been," Mr Maclaine said.

"In 2011, despite underlying demand for housing growing at its slowest pace for more than a decade, the market was once again undersupplied with only 25,719 dwellings commenced - the lowest year total on record.

"When the economy enters a period of weakness, the consequences of poor policy settings become more apparent - projects become unviable and housing shortages emerge."

UDIA (Qld) last month released a report showing the Queensland development industry had fallen from second to fourth largest sector in economic terms.

The Institute issued a call to both sides of government to commit to restoring prosperity to industry by addressing concerns over the prevailing planning culture; taxation on development; infrastructure and workforce development.

For more information, please contact Susan McCosker on 0422 567 667.