LATEST SUMMARY FROM THE AUSTRALIA CONSTRUCTION INDUSTRY FORUM (ACIF) ON THE STATE OF THE CONSTRUCTION INDUSTRY ACROSS AUSTRALIA
The ACIF Forecasts reflect a series of turning points in the construction industry across Australia, within the different parts of the construction industry and within the different states. The turning points reflect key macro-economic changes and industry developments.
Falling commodity prices has narrowed the pipeline of new major development projects or deferred other major projects — the engineering construction boom is projected to taper off.
Meanwhile historic lows in interest rates and improved housing affordability are expected to encourage an uplift in housing starts and an increase in residential construction spending.
A recent recovery in investor sentiment as well as lower interest rates is expected to encourage an improvement in commerce that will be reflected in an upturn in non-residential construction spending.
ACIF views that a fall in construction activity in some sectors of the industry will be offset by increases in others. Total construction activity is projected to amount to around $229 billion next year, roughly the same as it was in 2012-13. The total amount of construction building work to be done in 2013-14 is projected to be around 75 per cent larger than it was a decade ago. This is in real terms (that is, taking out the impact of inflation).
More than ever this sanguine BIG picture hides considerable variation, swings and troughs in construction spending in specific construction sub-sectors and in different states and cities. Those interested in gaining a full understanding of patterns and the outlook for construction should review the macro projections and construction aggregates as well as the detailed picture provided in the ACIF Forecasts.
Events since the release of May 2013 ACIF Forecasts that affect the outlook for our industry include:
– Ongoing concerns about the stability of the Eurozone.
– Signs that China is managing to sustain economic growth and price stability.
– Continued economic recovery in the US raising concern about the tapering off of quantitative easing and increases in interest rates.
– Fall in Australian interest rates to record lows and a fall in the $A/$US exchange rate
– Outlook for Australian growth has moderated although investor sentiment is improving.
For more information
– Purchase the Construction Market Report for your state and capital city.
– Use ACIF’s Customised Forecasts tools to generate your own forecast of demand for the work types and locations of interest to you. This information is available to Website Subscribers, so login or subscribe in order to benefit from this highly valuable information.
– Read the demand driven forecasts for 21 locales around Australia.