Boost for building in finance figures

PROPERTY News

Housing finance figures for December released by the Australian Bureau of Statistics are a promising start to 2011, according to Master Builders, Queensland’s peak body for housing and construction.

Master Builders Director of Housing Policy, Paul Bidwell said Queensland housing finance commitments for owner occupied dwellings rose by 2% in December to 9795 (seasonally adjusted), in line with national figures of 2.1%.
]“In isolation, this is not a significant increase, however it does build on the 1.7% rise in November and is the first positive sign we’ve had since August 2009, when finance approvals in Queensland slumped,” Mr Bidwell said.
“Other positive news from these figures is that the number of commitments for the construction and purchase of new homes also appears to have stabilised after falling by almost 40% since the latter part of 2009.
“Combine these stable figures with indications that the Reserve Bank of Australia may keep interest rates on hold for much of 2011 and things are starting to look brighter for Queensland’s housing industry.
“Unfortunately, the number of first home buyers fells by around 4.7%, meaning they now account for just 15% of housing finance commitments in the state, which is well below the long-term average of 20%. This is not surprising given the spate of interest rate rises and the wind back of assistance measures in January 2010. “Stable interest rates are good news for first home buyers, who are very susceptible to rising rates, and for the industry generally, as rebuilding confidence in the housing market is key to improving building activity overall.
“Building activity fell steadily for most of 2010, with approvals relatively flat in November and December. However, as long as interest rates hold steady as predicted, we anticipate the increase in finance approvals will translate to increased building activity in the next few months. “
However, even with additional work that will be generated by the state’s disaster rebuilding effort, we are still well short of where we need to be to get our industry back on track and we will continue to explore opportunities that will benefit Queensland’s industry.”
Master Builders will participate in the state government’s Building Revival Forum on 12 April, which will focus on the challenges faced by the building and construction industry and explore workable solutions.
“We will particularly be focusing on identifying measures to reduce the cost of new house and land packages in an attempt to overcome the challenge of building more affordable homes.”