Lowest number of homes built in NSWs recorded history

17 June 2009

Figures released by the Australian Bureau of Statistics today reveal that, in three months to March this year, less homes were built in NSW than any other quarter in recorded history.

The Urban Taskforces chief executive, Aaron Gadiel, said that yesterdays state budget measures supporting housing construction may have arrived just in the nick-of-time.

 

A further fall in home construction levels couldnt be tolerated by any government yesterdays action was clearly essential, Mr Gadiel said.

 

In the three months to March 2009 construction started on only 5,400 homes in NSW, compared with 7,500 in March 2008.

 

As recently as 2004, NSW was producing 11,000 new homes a quarter and Victoria is, even now, producing 9,000 homes a quarter, Mr Gadiel said.

 

In seasonally adjusted terms, the number of NSW residential construction starts fell by 7 per cent in comparison with the previous quarter, a bigger fall than the December quarters 6 per cent fall, but much less than the 22 per cent drop in the September quarter.

 

Victorias superior construction performance continues, with no change in its seasonally adjusted home construction starts – Queensland experienced a 6 per cent drop.

 

Its been hard to picture things getting much worse, but yet again, NSW home construction has been able to find new lows, Mr Gadiel said.

 

Construction commenced on only 2,100 apartments and town houses in NSW in the March quarter a 37 per cent fall on the March 2008 figures.

 

You have to go back as far as March 1988 before you can find a quarter where work started on less apartments in NSW, Mr Gadiel said.

 

The traditional relationship between apartment development in Victoria and NSW has been tipped on its head.

 

For the third consecutive quarter construction started on higher density homes in Victoria than in NSW.

 

You have to go back as far as June 1987 before you find the last time Victoria was building more apartments and townhouses than NSW.

 

Mr Gadiel said that NSW home approvals have been trending since January 2008.

 

Theres been a 38 per cent in trend home approvals in the 15 months to April 2009, he said.

 

The last home approval figures for April 2009 showed a sustained trunaround, in trend terms, in Victorian approvals, and a positive trend figure in Queensland.

 

NSW has been the national laggard.

 

Were hoping that the increased confidence following from yesterdays budget announcement will now lead to a turnaround in NSW.

 

Under the new Housing Construction Acceleration Plan, from 1 July until 31 December 2009 purchasers of newly constructed homes, other than first home buyers, will only pay half the normal stamp duty on purchases of up to $600,000 in value.

 

The NSW Government is also making available up to $200 million in interest free loans to NSW councils to fast-track local infrastructure projects. The new fund will target high-population growth areas where new developments are underway or planned for construction. The program will leverage unspent development levies held by local councils.

 

The Urban Taskforce is a property development industry group, representing Australias most prominent property developers and equity financiers.

 

For every $1 million in construction expenditure, 27 jobs are created throughout the broader economy. The construction activity made possible by property developers contributes $69 billion to the national economy each year and creates 709,000 direct jobs. The construction industry is Australias third largest source of employment.

 

 

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