Construction boom to extend through to the end of 2022
Updated: Jul 25, 2022
Australia has experienced a boom in residential construction throughout much of 2021 and this isn’t expected to slow down anytime soon.
As a matter of fact, major building corporations have started to reveal that this boom will roll over throughout 2022. The total number of constructions of new homes are set to exceed 191,000 next year.
The housing market is currently experiencing constraints on land availability and increased build costs due to material and labour shortages. Despite this, the Housing Industry Association have stated that the number of new home sales have been the strongest in almost four years.
The Housing Industry Association have also come forward with more results that have demonstrated a shift in housing preference types and the average number of people in households.
Where will builds be most significant?
As mentioned, there are already 191,000 new homes projected to be built next year. From this figure, the Housing Industry Association have stated that they’ll be responsible for 120,000 of them.
Victoria is set to see the largest number of new home builds next year. More than 37,000 new homes are expected to be built in this State. The next largest State according to the number of home constructions will be New South Wales at more than 25,000 builds. Queensland will be close behind at more than 24,000 constructions in 2022.
Other States and Territories will range between 9,000 and 600 in new home builds throughout 2022.
Shift to detached dwellings
Much of the growth seen in the residential construction market has been due to the shift in preferred living arrangements. A vast portion of home buyers have been from those living in units/ apartments who’ve wanted to live in homes that offer wider spaces.
Additionally, with the return of Australian’s from overseas, many have preferred to purchase house and land packages away from apartments in capital cities.
The construction of detached dwellings in regional locations have also experienced significant increases in 2021. This is expected to continue through to 2022 with more Australian's being offered the flexibility of working from home.
Another major factor that has contributed to this shift in demand for detached dwellings has been the economy. Tim Reardon the Chief Economist of the Housing Industry Association stated, “Demand for new detached home construction has remained strong because of economic lockdowns.”
Other notable factors
In their report, the housing corporation identified a trend that the numbers of people per household have decreased this year. They expect this trend to continue through to the new year.
Are you looking to build?
REIF have helped over 100 clients in their home construction journey throughout 2021. If you’re looking to build a house and land package in 2022, we have access to a vast number of options for investors and owner occupiers. If you would like the opportunity to uncover the potential to build wealth for your financial future, we would love to assist you on your journey.
Reach out on the details below to chat to a specialist about your options. Alternatively, if you wish to learn about the construction process, download our free eBook for first home buyers below.
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