Economist warns economic instability likely to slow construction industry
THERE were 55 dwelling approvals in the Douglas region for 2010/11 compared with 64 in 2009/10, a decline of 14.1 per cent.
The 2010/11 result was also 14.1 per cent lower than the 2008/09 result.
Housing Industry Association economist Matthew King said across Queensland, household confidence is suffering under the weight of an interest rate tightening cycle, serious weakness in key industry sectors, nervousness in relation to the carbon tax, and international economic instability.
“Combine that poor sentiment with ongoing supply side obstacles in the new home building industry, namely a recent history of inadequate land supply and excessive infrastructure taxation, and you have a recipe for serious new home building weakness,” he said.
“Certainly the recent State Budget announcement of the Building Boost Grant of $10,000 for those households who build or buy a new home will auger well for some rallying in new home building activity in the final months of 2011.”
“However, given the policy wasn’t introduced until August and the multitude of constraints afflicting new home building, it’s likely to be tough going at least until the fourth quarter of this calendar year.”