WA still on top for residential building

Western Australia’s residential building market has been ranked the strongest in Australia for the fourth consecutive year.

However, WA’s ranking is in danger of slipping, with its score on the latest Housing Industry Association Housing Scorecard declining for the past three quarters.

The scorecard is an aggregate of the value and volume of new home commencements, housing finance, home sales and alterations and additions, as well as the size and hours worked of each state’s construction workforce.

“Irrespective of whether the wind is coming out of the sails, residential building activity in WA is currently experiencing very buoyant conditions,” the HIA said.

The HIA said WA scored 82 out of 114, leading NSW, which scored 77, and the ACT, which scored 69.

The standout segment of the WA market, the HIA said, was detached home construction, with 5,565 dwellings approved in the current quarter and 5,545 starting construction.

Conditions were also strong in WA in the existing home market, with transfers of established homes 23.4 per cent above the decade average.

“Transfers of attached dwellings are up by a similar magnitude,” the HIA said.

“WA ranks as the strongest in the country across both these indicators.”

The WA market for home renovations, however, has been underperforming.

WA ranked sixth in terms of larger renovation jobs that require council approval, while it is the weakest capital city in Australia in terms of total renovation spending.

“The healthy resurgence in activity in the established home market provides some comfort that the renovations market may begin to recover over the upcoming quarters,” the HIA said.

Nationally, NSW was the biggest mover, surging up the rankings to second after having been ranked fifth just six months ago.

“There is daylight between the two strongest states and the rest of the pack,” HIA chief economist Harley Dale said.

“Among the other states, the Australian Capital Territory, Victoria and the Northern Territory are clustered closely together in the middle of the pack.

“South Australia and Queensland are still just off the pace, but there were some improvements in both those states.”

The weakest building market in Australia was Tasmania, a position it has held for six consecutive quarters, while the ACT recorded the most significant softening in residential building conditions over the past six months.