The value of building work done on new residential buildings in Australia eased by 3.6 per cent in the quarter ending September 2018 (in seasonally adjusted terms) when compared to the prior quarter, new data released by the Australian Bureau of Statistics (ABS) has shown.
As well as the value of new residential building falling, the number of home starts also fell, dropping by 5.7 per cent from the previous quarter.
Speaking of the figures, Geordan Murray, senior economist at the Housing Industry Association (HIA), elaborated: “A total of 54,803 dwellings commenced construction, which is down by 5.7 per cent in the quarter and down by 2.2 per cent against the same period a year ago.”
However, the ABS figures still reflect a 3.3 per cent increase in the overall value of residential building activity nationwide since the September quarter of 2017 in seasonally adjusted terms.
The HIA asserted that the fall in figures cannot be “considered a poor result,” as there was an appreciable amount of residential starts and new building works being carried out.
“Strong levels of new home starts early last year underpinned one of the strongest years of residential building activity on record,” Mr Murray said.
“Results for the second half of the year reflect the softening that have been evident in the broader housing market,” he added.
His comments come following data that showed that house values fell by nearly 5 per cent in 2018.
“We’ll continue to monitor activity closely, as leading indicators suggest that there were fewer new projects entering the pipeline in the latter stages of 2018. This is a warning bell for the trajectory of starts in 2019.”
According to Mr. Murray, the states where total housing starts increased in the September quarter of 2018 include Queensland (8.3 per cent) and Western Australia (2.9 per cent).
Notably, there was a large increase in the home starts in the ACT, at a whopping 41.5 per cent.
Total housing starts decreased in the remaining states in the September quarter of 2018, with the largest drop in South Australia, which fell by 18.6 per cent.
Victoria was close behind, as new residential building starts dropped by 16 per cent.
The HIA also noted that Tasmania (6 per cent), NSW (5.5 per cent) and the Northern Territory (2.9 per cent) all reported minor drops in home starts.