New home starts on upward trend

Western Australia’s housing construction rebound has continued, with new home commencements increasing for the second consecutive quarter according to the Bureau of Statistics.

WA defied a falling national trend with dwelling starts up 5.6 per cent to 5,773 for the December quarter, off the back of a big increase in the September quarter. In contrast, new home starts were down 2.3 per cent at a national level off an upwardly revised base.

There are signs the recovery is set to continue throughout this year, following ten-year lows in dwelling starts in 2012. Sales volumes for early 2013 have reached levels not experienced since 2006, according to the Urban Development Institute of Australia.

“Population growth of over 1,500 persons each week in Western Australia continues to put lots of pressure on rental markets in the state, especially in Perth where median rents increased 12.5 per cent over the last year,” UDIA WA chief executive Debra Goostrey said.

“With mortgage rates low, first home buyers have seen this as an opportune time to become home owners and this is freeing up existing owners to buy new homes.”

Housing Industry Association economist Geordan Murray said while New South Wales and Western Australia were on a path to recovery, the signals for the remaining states and territories were “weak”.

Dwelling starts in WA are tipped to increase 19 per cent to 21,000 dwellings in 2012/13, according to the joint industry and government Housing Industry Forecasting Group.