The economic downturn seems to be having little effect on the property and construction industry with first-home buyers surging into the market, and the Housing Industry Association (HIA) predicting that housing starts will grow by 13 percent in the next year.
The number of first-home buyers has increased over recent months, on the back of the federal government’s first home buyer’s grant, and a drop in interest rates.
Companies such as Stockland, Mirvac, Lend Lease and Australand reported a spike in first-home buyer sales over the weekend, with the general market auction clearance rate at a strong 77 percent.
According to HIA chief economist Harley Dale, the property market will continue to grow over the next couple of years.
“The first home owners’ boost, mortgage rates at a 40-year low and the housing components of the federal government’s national building and jobs plan have the capacity to deliver a moderate recovery in residential activity.”
RBA governor Glenn Stevens remains positive, telling a parliamentary hearing on Friday, he expects the recent rate cuts to help the construction industry.
“For ordinary people looking in lower-price areas, interest rates have improved things a lot from the housing affordability point of view. I think you’ll see the effects of that on housing finance and housing construction in the next couple of years.”
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