The Housing Industry Association is urging the Reserve Bank to cut the official cash rate again in February, after new data confirmed weak quarter growth for new housing and alterations.
According to the latest data from the Australian Bureau of Statistics, residential building work done fell by 1.6 per cent to an annualised level of $45.5 billion in the September 2011 quarter.
“Leading housing indicators looked very weak in late 2011, but ahead of this period actual residential construction activity had already been trending down for 12 months,” HIA chief economist Harley Dale said.
“A three pronged attack is required to resurrect activity in residential building, an industry which has a large multiplier impact in terms of output and employment across the wider domestic economy.
“There is an urgent need for further cuts in borrowing costs for both businesses and mortgage holders, short term government stimulus, and renewed action on the longer term housing policy reform front.”
New residential building work done fell by 1.9 per cent in the September 2011 quarter reflecting a 2.6 per cent decline in detached housing and slight fall of 0.3 per cent in ‘Other dwellings’.
Meanwhile, the value of major alterations and additions work done, which accounts for around 20 per cent of total renovations activity, eased by 0.2 per cent.