Housing market set for a gloomy year
The construction industry will face a tough year ahead, according to the Housing Industry Associations national outlook. 132,190 homes are expected to be constructed for 2008-09, a 17 per cent decrease since the previous year, and 50,000 short of underlying demand.
The HIA reports Queensland to be affected most by the weakening economy, whereas the states of Tasmania, South Australia and Australian Capital Territory appear to be more resilient compared to their larger state rivals.
HIA chief economist Harley Dale believes that the first-home owners' boost, mortgage rates declining to a 40 year low, and federal Government's building and jobs initiatives can stimulate some recovery in residential activity.
While auction clearance rates fair better in comparison to a year ago, the total value of property sold has significantly lessened. Australian Property Monitors reported 63.9 per cent of auctioned homes were sold Sydney in over the last weekend totalling $94.9 million, this compares to a 56.3 per cent clearance rate and $238.3 million worth of property a year ago.