Sydney and New South Wales drive construction

Construction-may-well-be-on-the-up-and-up-according-to-BIS-Shrapnel_157_78571_0_14100910_300The national construction market is getting a big boost in the coming years, according to economic forecaster BIS Shrapnel, and the Sydney and New South Wales markets are playing a big role.

The Building in Australia 2014-2029 report outlines how building activity across the country is tipped to overtake the peak last set 20 years ago, with 190,000 new dwellings predicted to begin construction in 2014/15. The level of construction will stay high in 2015/16 and 2016/17, though not hitting this high figure.

Most pertinently to Sydney buyers, it’s New South Wales that is seeing the bulk of the growth in construction. The First State is forecast to experience a 9 per cent growth in its housing starts over the next year. The two states that are next highest, Queensland and Victoria, are only seeing a 3 per cent growth each, well under New South Wales’ stellar result.

Sydney buyers will more than likely see increased opportunities to enter the property market in the NSW capital. Being Australia’s biggest city, and carrying a little under two-thirds of its population according to the Australian Bureau of Statistics, the bulk of any building activity in the state is likely to take place in the growing metropole.

The BIS Shrapnel report indicated as much, pointing out that recovery in home building is “being aided by strong investor demand, especially in Sydney”.

Buyers will be especially heartened at the news of a greater increase in property stock, given the concerns voiced by some about the availability of housing in the city. Currently, building of residential housing and infrastructure has been taking place in the city’s western regions.

The reasons cited for the spike in housing starts are Australia’s rapidly growing population and the low interest rates that are making home loans more affordable.

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