Data from the HIA indicates growth for new homes is on the rise, while apartments are set to decline.
In June, Shane Garrett, HIA senior economist, said every state and territory recorded growth in owner-occupied loans for new dwellings.
“The number of loans for new homes made to owner-occupiers rose by 3.6 per cent during June 2017 – the fourth month in a row to see expansion,” Mr Garrett said.
Looking at each state and territory, loans to owner-occupiers for construction or purchase of new dwellings over June have had the largest increase in Tasmania, at an increase of 38 per cent.
Following this is Queensland at 29.5 per cent, the Australian Capital Territory at 23.8 per cent, Western Australia at 7.9 per cent, the Northern Territory at 7.8 per cent, NSW at 5.8 per cent, South Australia at 4.6 per cent and Victoria at 3.5 per cent.
“New dwelling starts reached an all-time record high during 2016, with activity likely to see a modest reduction over the remaining years of this decade.
“The lending figures out today support HIA’s forecasts for a relatively modest correction in new home building.”
Despite the recorded growth, Mr Garrett went on to say that he and the HIA expect new home starts to decline during the next two years by approximately 24 per cent, bottoming out at about 175,000 starts per year.
Regardless, Mr Garrett believes this is “still a very healthy level of activity”.
During this decline, apartments are predicted to face the most significant reduction in building activity due to restrictions on foreign investors, which Mr Garrett said would be “depriving rental markets of sufficient supply”.