Master Builders Australia predict weak forecast for new home builds

The number of new houses built in Australia is projected to fall in the next financial year, according to analysts at Master Builders Australia.

However a recovery is projected eventually, as positive housing sentiment translates into action.


Over the past decade new home building in Australia hit record highs especially for units and apartment buildings, largely due to inward migration and low interest rates.

But the recent slowdown in new home building is largely down to “microeconomic factors” according to Master Builders Australia Chief Economist Shane Garrett.

These include tighter credit conditions, tougher financial regulations and the imposition of heavy stamp duty surcharges on foreign buyers by a number of state governments.

“Underlying demand for new housing is still very strong with large numbers of new jobs still being created and interest rates now even lower than before. The pace of population growth remains brisk,” Shane Garrett said.

“Consumer and builder confidence is the critical factor and it will take time for this to return, especially with house prices still falling in most markets. “

Master Builders forecasts predict that new home building commencements will bottom out during 2020/21 at 167,444.

This would represent a 28.3% drop on the 233,872 peak back in 2015/16.

By the end of their forecast horizon in 2023/24, new home starts have been anticipated to recover to 187,658.

This would be an 11.9% increase on the low point of the cycle expected in 2020/21.

Master Builders forecasts project that the market for major home renovations will grow from $8.97 billion in 2018/19 $9.38 billion in 2023/24 which represents a gain of 4.6%.

A record volume of detached houses approaching their thirtieth birthdays is positive for home renovations work, as is the availability of very low borrowing costs.

Images courtesy of Unsplash. 

Get our enews

Design and development news that comes to you

Securexchange protects financial property transactions

Protecting property transactions from fraud, hackers and scammers is essential to protecting client relationships and can be made ...

Aura Holdings gains development approval

Developer and retirement village operator Aura Holdings has gained development approval to start construction on The Pavilion residential ...

Tasmania housing debt waived by Commonwealth

Hundreds of new housing projects will need building in Tasmania, following the federal government’s decision to wipe the ...

Caltex selling portfolio of prime development sites

Caltex has pitched a portfolio of petrol station sites that are "apartment ready" at investors, worth more than $100m ...

AIDT 2020 Tour to iSalone for Milan Design Week

AIDT is proud to announce its International Design Tour 2020 is now open for bookings. This 12-day International Design ...


Stay connected to the SPEC

Join our reader network by signing up to our weekly newsletter and receive design and development news straight to your inbox

© 2018 Universal Media Co. All Rights Reserved. Privacy Policy. Terms of Service. The material on this site may not be reproduced, distributed, transmitted, or otherwise used, except with the prior written permission of Universal Media Co.