HIA Predicts 2014 Will Be Good For Housing Industry
Succeeding back-to-back years of decline, new dwelling commencements have got a spring in their stride this year. A Press Release on the website of the Housing Industry Association (HIA) quotes how the housing starts have enhanced by 11.7%, reaching a phenomenal 161,970 last year.
Cash rates to remain where they are
Shane Garrett, the senior economist for the Housing Industry Association believes that the government won’t correct cash rates in the year 2014. This will strengthen construction activity and at the same time facilitate quick build-up of home equity, leading to a higher number of renovation loans.
With Federal budget due in May, the ignition spark gained by the housing industry will cushion economic growth across all industries and also absorb the mining debacle to a large extent.
While renovations activity has fallen in 2013, it is expected to spike in the year 2014 by a moderate (but well-sustained) 1.9%. In 4 years’ time, renovations industry is likely to come up by nearly $4.3 billion.
NSW to lead charge
Garrett feels that the main torch-bearers of housing growth will be places like NSW, Queensland and Western Australia while areas like Tasmania and Victoria may lag behind. Robustly placed areas may be able to withstand the chronic undersupply they have witnessed for some years now.
You can go through the release here.
Don’t you think new constructions are too low in comparison to established ones in capital cities, presenting perennial undersupply conditions?