Construction activity has fallen to its lowest level in almost two and a half years, largely due to a lack of new work and tender opportunities, a report shows.
The Australian Industry Group-Housing Industry Association’s performance of construction index (PCI) fell four index point to 32.1 points in August.
It was the construction industry’s 15th consecutive monthly fall. Readings below 50 indicate a contraction in activity.
The report said this was due to a sharp fall in new orders together with weak activity across all major sub-sectors.
‘‘The prolonged downturn in the construction sector is detracting from current levels of activity across the broader economy through its impacts on manufacturing and service related industries linked to the sector,’’ Australian Industry Group’s Peter Burn said.
‘‘Construction employment has also been falling for some time and this too is being felt across the broader economy, as households reliant on wages from this important sector cut back on their spending.’’
Housing Industry Association chief economist Harley Dale said stimulus measures were urgently needed to prevent a big fall in building activity, as was seen during the global financial crisis.
FYI HIA Economics Group - Economic and Housing Snapshot report (PDF format). Following image (p. 21) is HIA's forward looking projections for dwelling starts (by number and per cent. change). Note that HIA title their projections as "Weak short term outlook for new home building..."
Let's compare the HIA and BIS estimates/forecasts. Taking BIS Shrapnel's estimate (10/11) and forecasts (11/12 and 12/13) based on 9/10 actuals (for NSW);
It would seem that BIS's forecast is not as optimistic as HIA's. Even still, both are less starts than occurred in 03/04 (45,710) and 04/05 (39,400), and considering that Sydney values (based on RP Data Hedonic Value Index) were essentially flat between Dec-03 and Dec-08 this may not bode well for Sydney values if there is any correlation between number of starts and housing values, i.e. more starts depresses values.
nice to see that even the "weak" WA starts will more than accommodate our projected population growth. And that is presuming the bull-case 5-10 year mining boom eventuates.
NSW Planning and Infrastructure Minister Brad Hazzard vows to cut red tape for housing builders
by: Teresa Ooi From: The Australian October 06, 2011 12:00AM
THE days of the sprawling McMansions are over.
NSW Planning and Infrastructure Minister Brad Hazzard wants houses to be built on smaller blocks -- about half the size of the McMansion -- to meet the state's acute housing shortage.
"The days of councils encouraging developers to build McMansions are gone," Mr Hazzard said.
The political veteran of 20 years lives on Sydney's northern beaches and has been Minister for Planning and Infrastructure since March.
Before becoming a politician, he had been a school teacher and lawyer.
Mr Hazzard said councils and developers needed to be more flexible, constructing houses on smaller blocks, of between 200sq m and 450sq m. Townhouse developments were needed with the provision for open space and realistic prices to meet the needs of young first-home buyers and older people looking to downsize but preferring not to live in an apartment.
He said the average block for a McMansion was between 550sq m and 750sq m.
That was too big for Sydney, which was suffering from an acute shortage of suitable housing for a growing population, Mr Hazzard said.
Many young couples could not afford to own a house, he said, and a mix of reasonably priced housing was needed in the $350,000 to $450,000 price range.
"I want councils to encourage this and developers to build them. We need to have the right mix of housing with minimal block sizes," he said.
Six months into the job as minister, Mr Hazzard confronts a staggering decline in housing starts and controversial planning law changes.
According to the Housing Industry Association, residential building starts in NSW fell by 20.1 per cent in the June quarter, to less than 6666.
Nationally, about 150,000 homes were built annually, when demand was about 175,000.
In the three months since coming into power, the state Liberal government has reversed the controversial part 3A provisions of the planning law that gave the planning minister sweeping powers to declare big projects "state significant" and approve them.
Power had now been returned to councils, and developments that were not "state significant' could be approved at council level, Mr Hazzard said.
One of his top priorities was to streamline planning to make it more transparent and open.
"That's exactly where I want to be," he said. Many developers had complained about poor responses from government departments. "Developers want to cut through the bureaucracy and red tape at council and government levels," he said. "It's time for NSW to send a message to councils and government that they have to adopt a can-do culture."
Cultural change was needed to secure the right housing mix.
Housing was a complex issue but he intended to double the number of houses built in the next few years, he said.
With a backlog of 530 development applications, many of them several years old, and inherited from the former Labour government, there was little choice but to slash red tape and get on with clearing development approvals.
With 152 councils statewide, he was a strong supporter of community consultation about development applications. "We have consulted ourselves senseless."
Mr Hazzard aimed to have a planning system that removed the need for residents to fight every development application.
"Communities want to be consulted as early as possible. They want to be heard," he said.
Mr Hazzard has served on the front bench and held 17 portfolios in opposition in the NSW Parliament.
He was first elected to parliament in 1991.
Married with two boys, his eldest is an actor who lives at home.
Andrew Hazzard has acted in several television series including Underbelly and Home & Away.
He was the lead in the Sydney Theatre Company's Spring Awakening.
Mr Hazard's younger son is playing college basketball in the US.
"My family grew up in politics but I've managed to attend my children's school plays as they were growing up," he said.
Here comes the Sydney construction boom I've been talking about for the past few years...
What on earth will drive this boom Shadow.Being a mechanic I have seen the workshop slow big time. Its just not going to happen.This will be another fail for you my friend.
lets look at mister "Brad Hazzards" credentials that give him this wonderfull insight to solve Sydneys problems...
1) former teacher and lawyer (one of your mates Shadow?)
2) veteran 20 year politician
3) minister for planning and infrastructure since March 2011 (a whole 6 months)
4) has an actor son living at home and one playing collage basketball in the USA (before you have a go ,they put it in the article to give him a warm fuzzy"i am one of the people look"
this guy would be that far from the realities on what is going on it's not funny and maybe he should look at the transport problems and services needed to be in place first before carving up the blocks to "ticky tacky" size and also ask the questions if the conection of the new services to the old ones will be able to cope with the "extra" volume....
he would have as much idea on what to do as Obamah has in fixing the US defict....... :sick: :sick:
SYDNEY'S real estate market is a tale of two tiers. On one side of the ledger it ranks in the top 10 most active markets for global real estate transactions. At the same time, as money is coming in, cash is not being used for construction. With Barangaroo the only significant development in the city in the next few years, developers are warning of tough times ahead.
This was borne out in the latest Australian Industry Group Australian Performance of Construction Index (Australian PCI), in conjunction with the Housing Industry Association, which was 4.9 points stronger in November at 39.6, although it was still well below the 50-point level separating expansion from contraction. According to the data, November marked the 18th straight month the national construction industry index has been in the red.
The director of public policy for Australian Industry Group, Peter Burn, said that while new orders were still contracting in November with the sub-index measuring 38.6, this was an improvement of 6.7 points on the previous month. According to the report, activity across the industry remains subdued although the November interest rate decision was reflected in the 5.3-point lift in house-building activity (38.6). The pace of decline also eased for engineering construction (45.6), with more work flowing from resource-based projects.
One of the things I've been predicting for some time was that the new NSW government would implement policies to boost residential construction. I have already posted some evidence of this occurring last year, and here is the latest development...
Quote:
Rezoning blitz in push for housing
Matthew Moore January 30, 2012
THE state government is moving to bypass councils and rezone sites nominated by developers as suitable for tens of thousands of new houses in a radical attempt to increase home building in Sydney.
With Sydney building barely two-thirds of the 25,000 homes needed each year, the government has invited land owners to nominate land suitable for housing and has established a committee, run by the Premier's Department, to assess 43 proposals from developers.
A schedule of ''land owner nominated sites'', published on the Planning Department's website, identifies more than 12,000 hectares of property, mainly on Sydney's fringe, enough land for more than 100,000 homes.
Many sites are outside the north-west and south-west growth centres where the former government concentrated new housing, a strategy that had failed, the Minister for Planning, Brad Hazzard, said.
One of the things I've been predicting for some time was that the new NSW government would implement policies to boost residential construction. I have already posted some evidence of this occurring last year, and here is the latest development...
Catweasel laugh. Copy a link from beloved media and then the attribute predictive power to the itself is none the more than a empty self promote. It a guess of a a two outcome. Nothing the more, nothing the less.
Catweasel laugh. Copy a link from beloved media and then the attribute predictive power to the itself is none the more than a empty self promote. It a guess of a a two outcome. Nothing the more, nothing the less.
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