Building Bonus elevates WA housing starts forecast
WA housing starts, given a jump start by the $25,000 HomeBuilder and WA’s $20,000 Building Bonus, are showing signs of recovery according to the Housing Industry Forecasting Group.
The group, a joint government and housing industry body, this month lowered its 2019-20 forecast from 15,500, made in November last year, to 14,500, which is still higher than the 12,500 forecast in April 2020.
HIFG is now anticipating that housing starts will rise to 17,000 in 2020-21, spurred on by consumer demand generated by Federal and State government grants.
The group said that the relative affordability of the WA housing market had boosted the impact of the grants.
However, uncertainty about the economic outlook and the impact of border closures on migration into WA, it has forecast dwelling commencement in a range of 14,000 to 18,000 for 2021-22.
Industry members of the group raised concerns about the capacity of the industry to meet the three to six month deadlines, including availability of civil and building trades, titled land and the capacity of local governments to process building permits and planning approvals in a timely manner. The industry was positive about the grants and stamp duty rebates announced for off-the-plan and partly built apartments, but said that that had disadvantaged sellers of unsold completed apartment stock who would be unable to start new job-generating developments until this was cleared.
Housing Industry Forecasting Group chair Professor Steven Rowley said rental markets were continuing to tighten with very low levels of supply.
“This potentially presents challenges once the rental moratorium ends and mortgage deferral periods conclude,” Professor Rowley said. “This could increase demand for social housing”.
There has been some improvement in the established housing market, underpinned by people returning from overseas and other parts of Australia.