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Optimism puts local builders ahead

A SURVEY by the Master Builders Association (MBA) and Bentley’s MRI has indicated a level of optimism in the WA industry not existent in other States.

The March quarter survey of building industry business conditions found the second- and third-home markets are supporting the building industry in WA, despite a fall-off in the first-home market.

However, the survey revealed that housing indemnity insurance re-mains a major issue for building contractors in WA.

Bentley’s MRI director Campbell Ansell said that, although the statistics related to the last quarter, it was clear that builders were starting to feel the pinch in relation to housing indemnity.

“There are plenty of builders who have got the opportunity to do work but they are unable to proceed because they are unable to secure insurance,” Mr Ansell said.

The survey suggests that the housing indemnity insurance issues threaten to stifle building activity and reduce work opportunities.

“There has been some relief. My understanding is [Minister for Consumer and Employment Protection, Training, John] Kobelke managed to put a cap of $10 million on the liability of insurance companies,” he said.

“That’s fine for the major players but there are still thousands of builders who are unable to afford it.”

Despite the demand, a number of builders can’t accept work, Mr Ansell said.

Employment demand in the housing industry has remained strong in the March quarter, with levels similar to those in the last part of 2001.

The MBA’s Building Industry Monitor shows that, in the six months to March 2002, there were 3,098 advertisements for on-site building trades-persons, an increase of 35 per cent compared with the same time period in 2001.

MBA Housing director Gavan Forster said the increase in stamp duty on established property had created a further incentive for people to buy a new home.

In the commercial sector the survey suggests that trading conditions are relatively stable, looking forward to better conditions in the June quarter.

“The survey has confirmed an optimistic feeling,” Mr Forster told WA Business News.

“The other point is, even in the first-home market the early indicators of land sales are still quite strong.

“All the indicators are that WA is still travelling reasonably well.”

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