none

CONSTRUCTION CAN'T BOOM FOREVER

10-08-2017
by 
in 

Anyone who's paid attention to the Sydney skyline over the past five years will have seen cranes pop up in increasing numbers, as commercial and residential construction continues apace. 

The North Shore has seen a spate of medium-to-high density housing spring up, and the CBD district has (among other projects) seen the Barangaroo development and the construction of the International Convention Centre. 

In the next three years, however, lots of projects are set to tie up and there's not a whole lot being planned to replace them. 

The number of homes being built is forecast to fall 31 per cent during the next three years, according to a report from industry researcher BIS Oxford Economics.

For high-density housing, the prognosis is even grimmer, with the report suggesting that their rate of construction will fall by 50%. 

“Analysis indicates that all states (with the exception of Victoria and New South Wales) are either in balance or oversupply,” BIS Oxford Economics managing director Robert Mellor said.

“With dwelling completions running ahead of underlying demand over the next two years, Australia will swing to a significant national residential stock surplus by 2018-19 ­despite NSW still facing a ­significant stock deficiency.”

BIS also predicts the value of all new builds — including commercial property — will slide from about $107.2 billion at present to $88.9 billion by June 2020.

This fall in construction was also predicted in May by industry analyst Macromonitor, who said that 2019 would be a "trough" for the construction industry. 

"The Sydney and Melbourne markets remain at or near the peak of an extraordinary upturn, which was driven by a long period of low interest rates, previous under-building, an unprecedented flood of foreign investment into residential property, and an influx of people returning to the south-eastern states after the mining collapse in Western Australia and Queensland," said Macromonitor analyst Nicholas Fearnley.

In total, the construction industry could be facing job losses in the hundreds of thousands.  

Related news & editorials

  1. 20.09.2018
    20.09.2018
    by      In
    Control Logic has set its sights on expansion, with a new leadership team incorporating key roles in products and marketing, sales and development, and operations and services. The move aims to increase the company’s skill set and focus to drive innovation and expand the company’s expertise and... Read More
  2. 19.09.2018
    19.09.2018
    by      In
    The Australian Made Campaign is providing some valuable support for the nation’s furniture manufacturers with its latest initiative, which urges local buyers to ‘take comfort in their purchase’ and choose genuine Aussie furniture, bedding and furnishings this spring.
    According to Australian Made... Read More
  3. 12.09.2018
    12.09.2018
    by      In
    Siemens has unveiled its new manufacturing facility in Yatala (Queensland), which has been set up to support the growing global demand for the locally developed Fusesaver medium-voltage circuit breaker.
    The new factory is part of an ongoing $25 million investment in manufacturing and research of... Read More
  4. 11.09.2018
    11.09.2018
    by      In
    APS Industrial has relocated its Melbourne base into an all-new 4500m2 head office and national distribution centre in Rowville. The new facility includes an interactive product showcase room and state of the art conference facility.
    According to APS Industrial MD David Hegarty, “Since our launch... Read More