Construction takes a rest
After three years of near record home building across the country, the residential construction industry in Australia will pause for breath before staging a comeback in 2007 according to a report released this week by the Housing Industry Association (HIA).
Commenting on the release of the September quarter 2004 HIA National Outlook publication, HIA’s Chief Economist Mr. Simon Tennent said that this moderation in activity will occur at a time when the fundamentals that drive housing demand remain robust.
Economic growth is relatively strong, the unemployment rate is historically low, and there hasn’t been the overbuilding of previous cycles, Mr. Tennent said.
This is quite clearly nothing like the housing shakeouts we witnessed in the late eighties and mid-nineties, and this is reflected in our forecasts.
We expect the down cycle to turn up in 2006/07 after which strong underlying demand, aided by a robust Australian economy and high overseas migration will come back into its own, he said.
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