Government policy must support the construction and renovations market to maintain economic growth, says the HIA.
The strong Gross Domestic Product numbers for the March 2016 quarter reveal the vital contribution of Australia’s residential building industry, says the Housing Industry Association.
Overall GDP grew by 1.1% in the March 2016 quarter, delivering annual growth of 3.1%. The result was better than expected.
“During the first quarter of 2016, the GDP growth rate in Australia was again boosted by the home building industry,” said HIA Chief Economist, Dr Harley Dale.
“New dwelling investment grew by 1.6% in the quarter – the fourteenth rise in the past fifteen quarters, while the first bounce in renovations activity since mid-last year was also an upbeat result,” he said.
“Residential construction, augmented by the substantial multiplier impact of industry activity through to the broader domestic economy, has been a mainstay of Australia’s economic growth during the last four years,” said Dale.
“It has been export growth, together with the broad positive reach of new home building that has kept our economy alive and kicking.”
“Against this backdrop it is disappointing that there is still little focus in the election campaign on the role of inefficient housing taxes and regulations in obstructing improved housing affordability, home ownership rates, and productivity in Australia,” Dale said.
“Stamp duty and excessive infrastructure charges are two prominent examples where reform would boost economic growth and productivity growth, but such outcomes are fanciful without policy engagement at a federal level.”
“Renovations activity is also a vital component of residential construction. Growth of 1.2% in the March 2016 quarter for investment in alterations and additions is a healthy result. The renovations sector has had a rough trot over recent years, but this latest update is an encouraging result.”
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