New home building activity set for a strong 2015: HIA

Recent housing finance figures from the Australian Bureau of Statistics show positive signs for new home building moving into early 2015.

Comparing October 2013 and October 2014 in Tasmania, the increase is 61.5%. Meanwhile, the Northern Territory and the ACT also scored double figures with 35.1% and 12.3% increases.

Victoria, Western Australia, Queensland and New South Wales all recorded increases of 9.5%, 8.5%, 4.2% and 1.2% respectively.

South Australia, however, declined by 3.3%.

The Housing Industry Association’s economist Diwa Hopkins noted that comparing the results from 12 months ago some big gains have been realised, particularly when looking at the total number of owner occupier loans for new housing.

 “While total lending to owner occupiers, excluding refinancing, eased by 1.4% during the month of October, loans to those constructing a new home expanded by 1.5% to a level that is 14.6% higher than 12 months previously,” said Hopkins.

“On the investor side of the ledger, lending for the construction of rental housing or housing for resale remained strong during the month. The value of lending edged higher by 0.5% to be 24.3% higher than a year previously,” she said.

Hopkins pointed to APRA’s updated guidelines on supervision of lending practices and the flexibility of their approach, and expressed that it is important that residential construction is affected as a result.

“There has been a string of disappointing data updates to the wider economy in recent weeks, but the residential construction sector has remained fairly resilient. Policymakers should be working to ensure that the sector can continue to be a key source of strength in the wider economy as the re-balancing of domestic growth continues to take effect,” she said.