Residential building performs well
Australia's construction industry is still in a state of expansion, although growth levels have softened since September, according to the Australian Industry Group (Ai Group)/Housing Industry Association (HIA) Performance of Construction Index (PCI).
There may still be many individuals taking out construction home loans, given the results of the latest index. The PCI dropped 5.7 points to a reading of 53.4 in the month to October.
Residential building has posted strong numbers across the board, with the HIA and Ai Group noting its continued strength.
"Apartment building activity expanded solidly (unchanged at 60.4 points) and house building activity was again robust, despite an easing in growth (down 4.4 points to 57.3)," the HIA and Ai Group noted in a November 7 release.
Any reading above 50 indicates expansion - the higher the figure, the stronger the expansion. Given this, activity in the apartment sector is particularly favourable.
Commercial construction posted a reading of 51.8 (down 6.6 points).
Despite a slowdown in expansion month-on-month to October, industry commentators are still positive about the existing levels of growth across the nation's construction industry.
"Three of the four construction sectors - engineering being the predictable exception - registered expansionary readings. With a general economic discourse seemingly focussed on negative news, recent PCI results remain a breath of fresh air," said Ai Group Director for Public Policy Peter Burn.
That said, Mr Burn noted that current activity is keeping up with the pace of demand, though not going beyond that. This could be particularly important for anyone looking to secure a home loan in future months.
"It seems the case, however, that the activity and new orders indices for both detached houses and apartments are consistent with the maintenance of elevated levels of residential building approvals, rather than further growth," he said.
Image credit: Francisco Anzola