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Dwelling starts tipped to fall

A MINISTRY of Housing forecasting group has tipped WA dwelling commencements will fall 30 per cent in the coming year before recovering some ground in the following year.

In the first six-monthly report into the future of the housing industry, the Housing Industry Forecasting Group (HIFG), suggests the GST may take some time to work through the system.

Housing Minister Kim Hames said the WA Government formed the forecasting group in response to concerns from the property industry when the Federal Government disbanded the Indicative Planning Council of the Housing Industry three years ago.

“It is essential that the Government has a broad view of housing needs, so it is better able to balance the provision of affordable housing and land with the needs of the private sector,” Dr Hames said.

“Any improvements that can be made to the cyclical boom and bust merry-go-round by accurate forecasting assists both the housing industry and employment.”

HIFG chairman Warwick Hemsley said the reports would be an important tool for the housing industry, bringing together data on construction, the real estate market and private rental market.

Office of Housing Policy senior policy officer Stewart Darby said the group forecast dwelling commencements for 2000-01 to fall to around 15,500 – a decline of 30 per cent from an estimated 22,347 commencements in 1999-2000.

“A moderate upswing is expected in the 2001-02 year with commencements forecast to increase 10 per cent to 17,000, consistent with underlying demand,” Mr Darby said.

The group’s 2000-01 forecast was more pessimistic than both BIS Shrapnel and the Housing Industry Association, although BIS Shrapnel expected starts to fall further in the following year while the HIA and the HIFG both expect a turnaround in 2001-02.

“The downturn is seen more as a correction as the current housing cycle had peaked when the GST-induced boom rolled in over the top,” the report said.

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