The ABS just released their Mar 2014 Quarterly Building Activity data for Australia. The seasonally adjusted estimate of the value of total building work done rose 3.7% to $21,822.5m in the March quarter, following a fall of 0.4% in the December quarter. The seasonally adjusted estimate of the value of new residential building work done rose 7.6% to $11,249.5m in the March quarter. Work done on new houses rose 5.3% to $6,700.6m, while new other residential building rose 11.1% to $4,549.0m. The seasonally adjusted estimate of the value of non-residential building work done fell 0.3% in the March quarter, following a fall of 0.2% in the December quarter.
Looking at the trend data, we see that both housing starts, and unit starts are up. This reflected the building approvals previously reported. With approvals more recently strong, (the seasonally adjusted estimate of the value of total building approved rose 26.1% in May after falling for four months, the value of residential building rose 13.5% after falling for three months, the value of non-residential building rose 59.5% after falling for four months), we should expect continued growth in construction starts.
Demand however continues to outstrip supply. We estimate that over the next three years we will need more than 900,000 new properties to meet demand, when over the last 12 months we achieved 176,891 units.
