The first home owner boost and very low mortgage rates alone are “not enough” to generate a sustainable recovery in the housing market, according to the Housing Industry Association (HIA).
In light of new figures from the Australian Bureau of Statistics that show a sharp fall in new residential building work in the March 2009 quarter, the government needs to do more to provoke long-term recovery, the HIA’s chief economist Harley Dale said.
“The timely roll-out of the social housing initiative to build 20,000 dwellings, together with other federal government programs such as the National Rental Affordability Scheme (NRAS) and the Housing Affordability Fund (HAF), are essential to ensuring that a new home building recovery gathers legs rather than peters out,” Dale said.
Seasonally adjusted work done on new residential dwellings fell by a downwardly revised 7 per cent in the March 2009 quarter to an annualised worth of $33.1 billion, 4.8 per cent down on a year earlier. Work done on detached houses fell by 9 per cent over the March quarter to be worth $22.5 billion in annualised terms. Work done on ‘other residential building’ fell by 2.5 per cent to be worth an annualised $10.6 billion, but leading indicators are suggesting a sharper pull-back to come.
There was a decline in seasonally adjusted new home building work done across Australia in the March 2009 quarter with the largest falls occurring in New South Wales (-13.1 per cent) and Tasmania (-11.8 per cent). There was a decline of 7.1 per cent in Victoria, 6.5 per cent in Western Australia, 3.6 per cent in the Australian Capital Territory, 3 per cent in Queensland, and 2.4 per cent in South Australia. New home building work done was down by 28.9 per cent in original terms in the
Northern Territory compared to the March 2008 quarter.
“Work done on major alterations and additions fell by 3.2 per cent in the March 2009 quarter but leading indicators suggest this sector will grow in the June quarter,” Dale said.
