Metricon Homes has been named as the largest homebuilder in Australia in a year where the total number of new builds was lower in a challenged market.
Building a total of 4,473 new homes across Victoria, Queensland, New South Wales and South Australia, it’s the fourth consecutive year Metricon has topped the HIA Colorbond Steel Housing 100 Report.
Of these starts made in the year ending June 30, which is when the report measures, 4,303 were detached houses and 170 were semi-detached dwellings
The nation’s largest apartment builder Meriton Apartments shot up the list to second place, from ninth a year ago.
The Harry Triguboff-owned Meriton’s jump was the result of a 55 per cent annual increase in housing starts to 3288.
In third place was Western Australia-based ABN Group with 2,987 new starts, followed by Dyldam Developments, Simonds Group and MJH Group.
But while some unit builders showed growth, the data shows there was a wider slowdown in starts of multi-unit housing.
In the last year that figure fell to 84,052, contracting 23 per cent, which was larger than the Housing Industry Association estimated, and will fall a further 12 per cent in the current year.
Free-standing building starts were slightly more resilient only falling 8.4 per cent to 111,528. That number is likely to fall a further 7.6 per cent in the current year before stabilising, the HIA estimates.
“The market pulled back 15 per cent over the last 12 months. Those in the largest 100 reduced by half of that,” HIA Principal economist Tim Reardon said.
“Smaller builders are wearing a disproportionate amount of pain from that contraction. The volume builders tend to be better at managing slowdowns… and tend to gain a bit of market share at this point in the cycle.”
The combined market share of the country’s 20 largest home builders is the largest it’s been since 2014, rising to 35 per cent.
As part of the market’s contraction, revenue earned from home construction by decreased by 16.1 per cent to $21.29 billion over the last year.
“Home building businesses in Sydney have experienced a sharper contraction in the number of new home starts than other jurisdictions,” the HIA said.
In Victoria, the change in the number of new housing starts of the top 20 home builders was barely detectable at 21,837 compared with 21,847 in 2018. In NSW that same figure fell 4.2 per cent to 15,688 from 16,384, as in some cases developers held off on starting new projects while waiting for completing projects to be absorbed.
The emerging demographic of young families looking for middle-ring suburban townhouses is bringing increased demand, Mr Reardon told the Australian Financial Review.
“We’re going to see a little bubble of young families coming through – the grandchildren of baby boomers – now entering that phase where they’re seeking to find a family home,” he said.
Images courtesy of Unsplash and HIA.
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