Housing construction in Australia is growing ahead with predictions the growth will be sustained for about five years.
In releasing its latest industry report, the forecasters are said that the building upturn which began six months ago is now at the top of the cycle.
The news for Queensland is buoyant, with Brisbane vacancy rates low and different Data figures showing the overall Brisbane property market is gathering momentum, having underperformed the combined capitals average since 2008.
The residential building construction in Australia is in a really sweet spot.
The fundamentals underpinning the market suggested the boom was sustainable due to a stock deficiency of 100,000 houses Australia wide – including 20,000 dwellings in Queensland.
Consistent with that is the vacancy rate figures. Brisbane is at 2.3 per cent – significantly below the 3 per cent balanced rate so that is also consistent with our underlying demand reading suggesting there is a long way to go in this dwelling construction recovery.
The relatively stable ratio of land to house price over time suggests that the cost of materials and labour has changed very little while the rising cost of vacant land has pushed up housing costs.
Private house starts are forecast to lift 13 per cent with medium density to rise by 6 per cent.
Queensland’s residential building activity has been driven by the “other dwellings” sector which jumped 50 per cent to the year ended March 2014 – largely reflecting the demand for high-rise apartments. Detached houses picked up only 2 per cent during the same period.
Forecasters’’ declared Brisbane as the powerhouse driving the upturn in the state’s residential building industry, strength is starting to return to the Gold and Sunshine coasts, while smaller centres like Toowoomba and Townsville are also picking up.