ABS Building Activity data a mixed bag

Data released by the ABS today shows why optimism is on the rise in the South Australian commercial building sector, but again highlights the need for policies to stimulate the struggling housing sector.

The value of work done for the September 2017 Quarter was $1.319 billion. Master Builders SA Chief Executive Ian Markos said there had been an increase in every quarter since September 2016, when the value of work done was $1.194 billion.

“After a lean period, South Australia’s construction industry is on the rise,” said Mr Markos.

“The State Government made infrastructure a focus of last year’s budget, and work is picking up,

“In the second half of last year there were also some really pleasing announcements, such as the $690 million Building Better Schools Program.

“The fact there was bi-partisan support for this program was a real confidence booster for the industry.”

However, Mr Markos said immediate reforms must be introduced to breathe life into the housing sector and protect jobs across industry.

The value of work commenced for new houses was $472.5 million for the September 2017 Quarter, down from $ 525.6 million during the June 2016 Quarter[2].

“Master Builders SA continues to push for the elimination of stamp duty for first homebuyers on new builds up to the median house price, which was $450,000 for the September 2017 Quarter,” said Mr Markos.

“This policy will stimulate industry and help young South Australians get into the housing market.”

Mr Markos said the key election policy had gained the support of Australian Conservatives and he was hopeful the major parties would also commit to it during the campaign.

“The Victorian Labor Government introduced similar stamp duty relief for first homebuyers last year, and the rate of dwelling units approved in that state is now by far the highest in the nation,” said Mr Markos.

Master Builders SA would also like to see the $10,000 Pre-Construction Grant for purchasers who entered into an eligible off-the-plan apartment contract between 22 June and 30 September brought back.

ABS stats show there was a solid spike in the value of work commenced for apartments and units from $113.3 million during the March 2017 Quarter to $350.3 million during the June Quarter. Even though there was a decrease to $284.9 million during the September 2017 Quarter, this still represents a significant increase from earlier in the year[3].

“Bringing back the Pre-Construction Grant would help maintain a heightened level of activity,” said Mr Markos.

“The Grant could even be broadened. For example, it could also apply to first homebuyers for new houses in regional areas. Master Builders SA supports consumer choice. South Australians who want a backyard should benefit too.”

Statistics referred to in this release are available at: http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/8752.0Sep%202017?OpenDocument

Download the media release here.