Investors Drive New Property Building Activity, ABS Data Shows
Investors Drive New Property Building Activity. Turnkey Investment.
Investors are driving new property building activity in Australia, newly released Australian Bureau of Statistics data shows.
Investment in new housing was up a seasonally adjusted 8.2% in October in 2013, compared to the same period in 2012. The investment figures drove the overall building activity higher in Western Australia by 1%, leading every other state in the nation.
“The good news is that investors aren’t just buying established dwellings and driving up home prices, but money is being ploughed into new house and apartment developments and adding to housing supply and economic activity,” Commonwealth Bank Chief Economist Craig James said.
“It is clear that home construction will play a key role in driving the broader economy in 2014, taking over from the mining sector. And arguably more industries and regions will feel the benefit of increased home building rather than mining construction.”
Craig James also noted younger Australians will be relying heavily on property investors to keep providing property supply.
“Many young Australians are banking on investors funding new housing developments, given that preferences have shifted to renting rather than buying in recent years,” James said.
Meanwhile, owner occupied new housing was up a seasonally adjusted 1% for the period, the ABS figures showed.
10300 new investment properties were build in October 2013 across Australia.
“The total value of investment housing commitments (trend) rose ($275m, 2.9%) in October 2013 compared with September 2013,” the ABS said.
“Rises were recorded in commitments for the purchase of dwellings by individuals for rent or resale (up $207m, 2.6%), commitments for the construction of dwellings for rent or resale (up $43m, 7.0%) and commitments for the purchase of dwellings by others for rent or resale (up $25m, 3.2%). The value of investment housing commitments seasonally adjusted rose 8.2% in October 2013.”