Residential construction excepted to fall over the next two years according to the HIA
The HIA (Housing Industry Associations) is forecasting that new residential home building will start to slow down towards the end of 2016 and has warned that the decline will be across the whole of Australia.
The HIA stated that 220,000 new dwellings started in Australia in 2015 which is a record high but warned Australia new build construction market that it’s coming off an unprecedented up -cycle and there would be a subsequent large decline to come over the next couple of years. The HIA have forecasted that a reduction in new dwelling actively will speed up during 2017 and will be at its lowest in the 2017/2018 financial year with around 160,100 new builds.
HIA chief economist Dr Harley Dale said “Looking beyond the current cycle, a strong focus on housing supply and policy reform is crucial to Australia’s future economic and social prosperity,”
“Australia will fail to achieve this objective without Federal Government leadership and involvement in housing policy reform, including strategic planning for the future housing and residential infrastructure requirements of our growing and ageing population.”
The negative gearing policy is hot topic at the moment with Australia most likely having an election later this year, Prime Minister Malcolm Turnbull has warned against the talk of restricting negative gearing but the Government it seems has left that door wide open leaving uncertainty around this.
With housing making a massive contribution to the economy the HIA have previously warned against changes to the tax break, implying it would most likely reduce investment in housing.
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