Invest
Decline in housing not expected for the next few years
Though many agree a fall in housing numbers is on the cards for Australia, one economist anticipates those numbers will continue to grow in the near term.
Decline in housing not expected for the next few years
Though many agree a fall in housing numbers is on the cards for Australia, one economist anticipates those numbers will continue to grow in the near term.
Speaking at the Housing Industry Association’s (HIA) Industry Outlook forum, Shane Garrett, HIA senior economist, said that high volumes of housing will continue through to at least 2019.
The HIA’s recent Housing Outlook Report states 221,500 new dwellings in 2016-17, which is 4.5 per cent lower when compared with the previous year, and a further fall of 10.7 per cent is predicted for 2017-18.
Driving this fall is said to be multi-units, with new construction predicted to fall by 41 per cent during this time.
“Solid population growth, very low interest rates and consistent gains in employment do mask some concerning trends with respect to underemployment and decelerating GDP growth,” Mr Garrett said.
“Combined with another layer of obstacles to foreign investor participation in the housing market, new home building volumes are set to move downwards over the next couple of years.
“Having achieved record levels early in 2016, new home building starts are clearly in a downward cycle.
Mr Garrett said this downward cycle is different than previous cycles, as the bottom, predicted for 2019, will be higher than the peak of the last boom in 2010 and the peak in 2015-16, which “dwarfed all previous peaks,” resulted in a backlog that means the construction industry will still be building houses into at least 2018.
“The housing boom was not consistent across Australia and now, with NSW and Victoria cooling, all indicators are that the market is well past its 2016 peak when over 231,000 new homes were commenced,” he said.
“Even though new dwelling starts will decline over the next couple of years, the annual volume of new home starts is not likely to fall below 170,000 at any stage. By any standard, this is still a very elevated level of activity.
“The investor side of the market has also been hit by tighter lending finance due to APRA’s recent restrictions on interest-only mortgages.”
RELATED ARTICLES
Property
The 2026 Suburb Thesis: A case study in turning trend lists into investable strategy
A new crop of ‘suburbs to watch’ is hitting headlines, but translating shortlist hype into bottom-line results requires more than a map and a mood. This case study shows how a disciplined, data-led ...Read more
Property
From signals to settlements: A case study in turning property insight into investable action
Investor confidence is rebuilding, first-home buyers are edging back, and governments are pushing supply — yet most property players still struggle to convert signals into decisive movesRead more
Property
Australia’s rental choke point: why record-low vacancies are now a boardroom issue
A tightening rental market is no longer just a housing story—it’s a macro risk, a labour challenge and a strategic opening for capital. With vacancies near historic lows and rents still rising, ...Read more
Property
Rents are rewriting the inflation playbook: what record‑low vacancies mean for Australian business
Australia’s rental market is so tight that housing costs are now a primary transmission channel for inflation and interest rates. This isn’t just a property story; it’s a business risk story—affecting ...Read more
Property
Off-market real estate is going mainstream — and changing the rules of dealmaking
With public listings tight and sales still climbing, Australia’s investors are shifting to off-market channels that reward speed, networks and data advantage. The playbook is closer to private equity ...Read more
Property
Australia’s rental squeeze is now a business problem: inflation, capacity and the new growth calculus
Record-low rental vacancies are no longer just a social headline – they’re reshaping cost structures, wage dynamics and capital allocation across corporate Australia. With economists warning of a ...Read more
Property
Rents Are Repricing Australia Inc: What record‑low vacancies mean for inflation, talent and strategy
Australia’s rental market has slipped into a vacancy desert, and it’s not just tenants feeling the heat. Persistently tight supply is pushing up rents, embedding services inflation and complicating ...Read more
Property
Young buyers poised for a comeback as 5% First Home Guarantee takes effect
In a move set to reshape the Australian property landscape, the government’s revamped First Home Guarantee is poised to open the doors of homeownership to a new generation of young AustraliansRead more
Property
The 2026 Suburb Thesis: A case study in turning trend lists into investable strategy
A new crop of ‘suburbs to watch’ is hitting headlines, but translating shortlist hype into bottom-line results requires more than a map and a mood. This case study shows how a disciplined, data-led ...Read more
Property
From signals to settlements: A case study in turning property insight into investable action
Investor confidence is rebuilding, first-home buyers are edging back, and governments are pushing supply — yet most property players still struggle to convert signals into decisive movesRead more
Property
Australia’s rental choke point: why record-low vacancies are now a boardroom issue
A tightening rental market is no longer just a housing story—it’s a macro risk, a labour challenge and a strategic opening for capital. With vacancies near historic lows and rents still rising, ...Read more
Property
Rents are rewriting the inflation playbook: what record‑low vacancies mean for Australian business
Australia’s rental market is so tight that housing costs are now a primary transmission channel for inflation and interest rates. This isn’t just a property story; it’s a business risk story—affecting ...Read more
Property
Off-market real estate is going mainstream — and changing the rules of dealmaking
With public listings tight and sales still climbing, Australia’s investors are shifting to off-market channels that reward speed, networks and data advantage. The playbook is closer to private equity ...Read more
Property
Australia’s rental squeeze is now a business problem: inflation, capacity and the new growth calculus
Record-low rental vacancies are no longer just a social headline – they’re reshaping cost structures, wage dynamics and capital allocation across corporate Australia. With economists warning of a ...Read more
Property
Rents Are Repricing Australia Inc: What record‑low vacancies mean for inflation, talent and strategy
Australia’s rental market has slipped into a vacancy desert, and it’s not just tenants feeling the heat. Persistently tight supply is pushing up rents, embedding services inflation and complicating ...Read more
Property
Young buyers poised for a comeback as 5% First Home Guarantee takes effect
In a move set to reshape the Australian property landscape, the government’s revamped First Home Guarantee is poised to open the doors of homeownership to a new generation of young AustraliansRead more
