Building Permit Approvals Up: Building Industry Outlook
Last Friday I had the pleasure of attending an industry event where one of the guest speakers was HIA’s chief economist, Mr Harley Dale.
Harley reported that he had just now received the latest building related statistics and to summarize:
• Although the media focus on the mining investment phase coming to a peak, this has already happened.
• The WA housing industry is recovering with Harley speaking specifically of alterations and new building both seeing improvement.
• People are presently borrowing less from the banks and more people are ahead on their mortgage repayments.
• Residential land sales are up 68% as of December 2012 – though in green field subdivisions, waiting on the release of titles is becoming an issue.
• Local government building permit approvals are up. This is more than likely due to the new building act providing the opportunity for people to make certified applications with a CDC from a private Building Certifier. Councils are limited to 10 days to approve the application or they must refund the application fee – a great motivator.
• The affordability of WA housing stock has increased.
• Lending has increased – for first home owners it’s up 27%, non first home owners it has increased 5% and lending to investors has increased by 50%.
• The housing shortage is more acute now than before the GFC. The government is aware of this and has brought about changes to the planning and development act, namely an increase in the size of granny flats and also the ability to rent out your granny flat to people who are not members of your family. This will quickly increase housing density in the suburbs.
Something that we all found surprising was that about 44% of the cost of a new house goes to the government in taxes! Whether that be GST, stamp duty or other taxes. That was truly shocking to me. Harley also went on to say that the housing industry puts more GST into the economy than any other sector. It seems a little harsh when you consider that building surveyorsare ensuring safe and accessible buildings, builders are simply putting roofs over people’s heads, energy assessors are making sure the building are efficient and the average taxpayer is just looking for a place to call home.
Thanks for reading.
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