Report: New home building to come close to all-time high
New home building is set to reach its second highest level ever this year, according to the Housing Industry Association's (HIA) latest National Outlook report.
The National Outlook, touted as "Australia's most comprehensive housing report card" by the HIA, forecasts new housing commencements to hit 180,000 in 2013/4 and the 2014 calendar year. The only year that beats this impressive number is 1994, which saw a whole 187,000 new dwellings commenced. This may well serve as a lifeline for first time buyers who feel closed out of the current Australian property market.
If correct, commencements in 2013-14 would experience a growth of 10.3 per cent, which itself comes on the heels of a 11.7 per cent jump in 2012-13.
Face of new home building changes
The HIA's research has found that a growing share of these new commencements will be medium to high density housing, although detached houses will continue to represent the majority of new building. There is thus a variety of residential real estate available for buyers.
Multi-unit building commencements will see a second consecutive growth year in 2013-14, jumping 14.4 per cent to reach an all-time high of 78,669. That means they make up 44 per cent of total new dwelling commencements.
At the same time, detached houses have seen their share shrink from the 68 per cent they held 10 years ago to 56 per cent in 2013-14.
Still, the HIA warns that this may simply be a case of cycles working themselves out. Detached house commencements saw their first growth in three years in 2012-13, and are predicted to make up 64 per cent of all new home building by 2016-17. The HIA expects the building of new detached houses to hit a peak of 109,010 in this same year.
New home building spread all over
The recovery in housing commencements was relatively spread out through a variety of states, an "encouraging development for the sector and the wider domestic economy", according to the HIA.
New South Wales was the big winner, with new home commencements increasing by an estimated 21.9 per cent in 2013-14 to a total of 49,000 - its highest level in more than a decade.
Queensland also benefited, with its commencements predicted to grow by 24 per cent to 36,335 during 2013-14, its highest level in six years. Western Australia and South Australia have both also seen increased activity, hitting an all-time high of 27,582 and a rise of 17.1 per cent in 2013-14, respectively.
It is a far cry from the situation two years ago, when commencements fell in every single state and territory.