The Housing Industry Association (HIA) has released its latest National Outlook, which forecasts a 10% decline dwelling starts this financial year, from 232,540 to 209,050, with a further 16% fall forecast for 2017-18, before another 5% decline in 2018-19; although the HIA admits there are downside risks to its forecasts (see next chart).
According to the HIA:
“As the down cycle in new home building unfolds, the record pipeline of medium/high density dwellings in particular creates considerable uncertainty as to the timing and magnitude of the decline in construction.”
HIA’s forecasts are for a peak of over 232,500 new dwelling commencements to have been reached in 2015/16, which will be followed by three consecutive years of decline. New dwelling commencements are forecast to bottom out at a level of around 166,500 in 2018/19, but there is downside risk to this forecast under current economic and political settings.
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