Foreign investment spurs record high building commencements

Foreign investment spurs record high building commencementsNew home building in Australia has reached a new record high, exceeding 200,000 commencements for the first time, according to latest Australian Bureau of Statistics Activity figures.The ABS Building Activity statement for March 2015 finds that building activity for the year reached 204,145 dwellings, up 15.6 per cent on the previous year’s 176,613 dwellings.Building approvals continue their unbroken upward trajectory, also hitting new records over the past 12 months, with the 218,422 approvals a 13.4 per cent increase on the previous year.A state breakdown of building commencements finds positive results in most states and territories, with a 26.3 per cent increase in dwelling unit commencements in Victoria, 20.9 per cent in Queensland and 8.3 per cent for NSW. Only the ACT recorded negative growth, with a 30 per cent decrease in dwelling unit commencements over the year.Building completions were equally strong, with all states except the ACT recording solid growth, including a whopping 71.3 per cent in the Northern Territory. The Residential Property Price Index is up 6.9 per cent, from 114.2 in 2014 to 122.1 in 2015. However, Sydney continues to drive residential property price increases, with the weighted average across cities less favourable once Sydney is removed from the frame.Property Council of Australia Chief Executive Ken Morrison says the survey results are good news for the industry, and for homebuyers.”The only way to improve housing affordability is to get more housing on the ground earlier. The industry is delivering record levels of housing – and much of that is on the back of foreign investment,” Morrison says.”Every newly constructed home that a foreign investor purchases enables up to four other homes to be built. Foreign investors are increasing the availability of housing for Australians by providing crucial early stage capital. The result is all there in black and white – more new homes for Australians,” Morrison concludes.