“Stronger new home building activity made an important contribution to growth in Australia’s economy during the September 2017 quarter,” commented Shane Garrett, HIA’s Senior Economist.

Today’s national accounts figures indicate that GDP rose by 0.6 per cent during the September 2017 quarter and was 2.8 per cent higher than a year earlier. New home building expanded by 1.0 per cent during the quarter even though it was still down on the same time last year.

“Interest rates are remaining lower for considerably longer than expected and this has provided detached house commencements with a bounce – something that today’s GDP figures have captured.

“In addition to this, building activity on the ground remains buoyed by the task of completing the large volume of new homes which were commenced last year.

“We expect that there will be a modest slowdown in new home building activity and this is being accentuated by restrictions on foreign investor participation in key housing markets and another round of APRA constraints. It is therefore important that there be no further interference in the policy or regulatory settings that underpin confidence in the sector.

“Australia’s economy is still not growing quickly enough to warrant an increase in interest rates any time soon. We need interest rates to remain very low in order to nurture a healthier pace of economic expansion,” concluded Shane Garrett.

Read more about the Australian construction sector:

Construction and renovations propel economy

Slow down in housing hits GDP

New home building stalled in May