Mining drop has little impact on housing market

QUEENSLAND is shrugging off the mining downturn amid declining housing investment and a decreasing pipeline of construction work, according to Australia’s central bank.

The minutes of the latest Reserve Bank of Australia meeting reveal the board is optimistic about economic conditions in the Sunshine State, citing evidence of a recovery from the mining downturn, rising commodity prices and the sustained strength in construction.

The RBA stated while unemployment rates in Queensland had remained high relative to earlier periods, employment growth had risen.

That suggested the labour market adjustment to the earlier decline in the terms of trade and falling mining investment was progressing.

The board observed that economic conditions in the state had generally strengthened over recent quarters, reflecting continued growth in consumption and a pick-up in business investment and demand.

Strength in tourism and other service industries had supported growth in aggregate demand in Queensland.

In contrast, the minutes said population growth had been below average, reflecting lower net overseas and interstate migration.

The RBA noted dwelling investment remained at a high level, but building approvals had stepped down and the pipeline of residential construction work appeared to have passed its peak.

In Queensland, the central bank said dwelling investment had declined from very high levels and the stock of work in the pipeline was being worked down gradually.

In the eastern capital cities, a considerable number of new apartments was scheduled to be completed in the period ahead.