New building development is in danger of stagnating for the next two years, while calls growing stronger from the building industry for the government to spend more on public building and remove planning bottlenecks on private building (remove limitation on the number of private building).
The future of construction will be impacted by the fading effects of stimulus program and the hope that apartment construction will take the strain off industry growth if interest rates stay reasonable.
Federal government stimulus were largely responsible for the strong 15% rebound in the national value of total building commencements in 2009-10. However, federal government spending will be expected to fall away during 2010-11 and 2011-12.
The effects of the stimulus already can be seen from the decrease in first home buyers by 50% over first half of 2010 compared with the first half of 2009 and non-residential building approvals have trended down sharply over the past six months. There are also two factors that will drags on economic growth in 2010-11. The first is a 27% decline in net overseas migration to 175,000 people, which will constrain retail sales growth. The second is a 3% drop in private sector non-residential construction.
No comments:
Post a Comment