Residential building work value set to spike
Recent findings from Master Builders Australia (MBA) indicate the value of national residential building work will grow over the coming three years, following strong activity in the 2013-14 year.
Residential building work value to rise
During 2013-14, the value of residential work totalled $51 billion. It's expected this figure will rise to $68 billion by 2016-17, according to a July 17 statement from MBA.
Those considering their home mortgage options may wish to look closer at New South Wales, Queensland, South Australia and Tasmania as these states are expected to be the strong performers in the sector.
With the Reserve Bank of Australia retaining a 2.5 per cent official rate for 11 consecutive months, variable or fixed home loans could be popular among those looking to extend their property interests.
"The underlying assumption is that interest rates will remain at low levels and continue the process of unleashing unmet pent up demand from the previous decade where supply failed to match strong population growth," the MBA stated.
Dwelling starts are expected to lift beyond 200,000 over the next three years.
The Australian Bureau of Statistics found there was a 1.7 per cent increase in the national population during 2013, highlighting the need for adequate housing.
The verdict for non-residential building and engineering construction
While the residential building sector will be the main concern for homeowners and investors, an awareness of activity in other sectors can contribute to a well-rounded view of the Australian economy.
Non-residential building "bounced back" during the 2013-14 year, with 5.9 per cent growth in real terms, the MBA explained.
Overall, non-residential construction may not rise considerably between 2013-14 and 2016-17.
Engineering construction is anticipated to fall by one-fifth in real terms over the coming three years, from $122 billion to $102 billion.
"Nevertheless, the forecast fall back in activity in the Northern Territory, Western Australia and Queensland follows boom conditions and will remain at high levels. New South Wales, Victoria, and Tasmania look set to particularly benefit from stronger infrastructure spending," the MBA noted.
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