Confidence dips in residential construction

Confidence dips in residential constructionNew data shows a significant cooling of expectations for residential construction in the December quarter, according to the latest ANZ/Property Council Survey.The nation’s leading measure of confidence in the property industry surveyed the sentiment of more than 2200 respondents across Australia, finding that overall confidence levels remain firmly in positive territory, recording only a one point drop nationally on the previous quarter.However, it has edged downwards over the four quarters for 2015, and the reading of 130 for December 2015 is five points below the same quarter for 2014. A score of 100 is considered neutral.New South Wales remains the most optimistic state, with a confidence score of 144, despite a two point drop. Victoria is holding steady at 134. Queensland, at 132, has risen two points, while the Australian Capital Territory is up four points to 135.The Northern Territory is up 11 points, but from a lower base, and currently sits on 105.Tasmania’s confidence fell by one point to 142, South Australia fell two points to 118 and Western Australia flatlined at 102.Read more about the latest findings of the survey.ANZ’s co-head of Australian economics, Cherelle Murphy (pictured), points out that respondents in the majority of the states are less optimistic than 12 months ago.”Those in the residential sector recorded a larger decline in confidence in the last 12 months than any of the commercial property sectors,” adding that a softening housing sector would affect employment growth in the construction and services industries benefiting from housing activity.Property Council chief executive Ken Morrison says the results should be closely read by policymakers.”The economy has relied on strong housing and construction, so any softening would have a broader national impact, particularly in terms of jobs and economic activity,” Morrison says.He says housing affordability “hinges on maintaining a high level of new residential construction”, with the survey results making the task of removing the major roadblocks to further growth “more urgent”.According to John Nguyen, national research manager at the Property Council, the quarterly ANZ/Property Council Survey provides a “regular check of the property sector’s pulse”.”This survey is a litmus test for governments to test how their policies and programs are faring, and whether they are encouraging investment and development,” he says.Nguyen says the confidence survey is “just one of a suite of market intelligence reports the Property Council produces each year to help the industry make informed decisions.”To check out the range of reports available, visit the Shop Research section of the Property Council website.