Denita Wawn, CEO of Master Builders Australia, said “the new modelling conducted by Master Builders Australia shows the devastating impact the lockdown of the economy is having on the building industry, the economy and the community.”
In February the MBA forecast around 159,000 new housing commencements in 2020/21. They now expect around 116,000, a drop of 27%.
“The required target is 200,000 homes a year which means that the impact on housing needs of our community will be severe,” Ms Wawn said.
“The housing industry is vital to the economy and jobs. There are nearly 400,000 building and construction firms in Australia and more than 90 per cent do work in the residential building sector. Around 388,000 of these are SMEs,” she added.
This is not the first ‘recession’ in the building trade. We know that construction prices will fall and 10-15% is not uncommon, which is substantial. And trades will be on time, also a substantial benefit.
Fewer houses being built means demand for existing homes is heightened, with people who have jobs also having more cash, given the changing consumption patterns that COVID-19 is establishing.
Of course, we will have up to 170,000 less immigrants in the next year or two as well, but they are traditionally lower end apartment buyers, not family home buyers.
