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Strong sector has problems

ACTIVITY in the building industry remains strong despite the sector encountering problems associated with long periods of heightened building activity.

Bottlenecks in the building licence process, planning hold-ups, and shortage of trades and materials are some of the hurdles currently facing the industry, according to the MBA Bentleys MRI survey of building industry business conditions for September quarter 2003.

The quarterly survey monitors business activity and expectations in the housing and commercial sector across 81 major building contractors to provide a snapshot of industry conditions.

The demand in the sector continues to accelerate, with the survey forecasting 19,000 dwelling starts will occur in the 2003-04 period, a similar level to 2002-03.

Western Australians’ love affair with renovation continues with home owners in WA paying $1 billion per year for renovation work.

A 40 per cent increase in commercial building approvals to $1.4 billion in 2002-03 is now having an impact on site, while a stronger tender market is being experienced in addition to increased demand for bricks, other construction materials and tradespeople. 

Official figures indicate that the State’s total annual building activity will be around $3.3 billion, however the figure could be closer to $4 billion (excluding civil construction).

Parallel with the rise in housing and commercial building, the demand for skilled labour remains intense, which is creating shortages in some trades. In the three months to October there were 3,967 job advertisements, 25 per cent higher than for the same period in 2002.

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