The Housing Industry Association (HIA) says it’s disappointed in the federal government, following newly released residential building statistics, over what it views as procrastination with regards to fiscal reform.
HIA economist Geordan Murray says the organisation had hoped to see a more balanced use of federally-led fiscal reform in 2012, including planning reform and monetary policy.
“To date, monetary policy has been the primary macro-economic tool in play and it looks like this situation will persist. It is time to see federal and state government action occur to a substantially larger extent than is currently evident.”
Murray’s comments come after residential building figures released yesterday showed little improvement in the September quarter.
There was some good news - aggregate volume of residential building work increased by 0.6% following five consecutive quarters of decline. However, Murray says, despite the improvement, September still looks likely to be one of the weakest quarterly results in the last decade.
He says the total volume of work done over the twelve months to September was 5.7% lower than the same period in 2011.
“If the Reserve Bank are looking to residential construction to contribute to economic growth in 2013, today’s result provides a lay-down-misere to cut the cash rate again at next Tuesday’s board meeting and brighten the prospects of a decent recovery emerging.”
All but one state posted annual declines in the volume of residential building work in the year to September – the ACT, where the volume of work done on multi-unit dwellings in the last year drove an increase.
The September quarter showed improvements in the volume of new residential construction activity in NSW, (9.9%), Victoria (3.8%), WA (12.2%) and Tasmania (11.9%).
Meanwhile, Murray says, Queensland and SA have gone “from bad to worse.” All sectors of residential building in these two states declined over the September quarter, providing for a fall in the total volume of work done in Queensland of 10.8% and 8.9% in SA.