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“Lending for new homes is down by 62.4 per cent since its peak in January 2021, to its lowest level since November 2012,” added Mr Reardon.
“Sales of new homes have stalled in recent months as market confidence declines.
“This poor data is as a consequence of the fastest increase in the cash rate in a generation. Despite this, the impact of last year’s rate increases won’t be fully apparent until late this year.
“The decision by the RBA to increase rates further in 2023, will further erode market confidence and accelerate the downturn that is already evident.
“There are significant lags between a change in the cash rate and its impact on the economy. In this cycle, it will take up to 18 months before the impact of the May 2022 rate increase fully flows through to employment in the sector.
“The supply chain disruptions of the pandemic are easing. Inflation in other economies is slowing and interest rates are not the only tool at governments’ disposal to address the inflationary problem,” concluded Mr Reardon.
Earlier this year HIA made a comprehensive submission in response to the Building and Construction Industry Review, including a proposal to introduce registration of building inspectors engaged by consumer. The review also extended to council notification and the building inspection regime. Government has now progressed further consultation on these matters.
As 2025 draws to a close, we want to thank you for your continued support and engagement.
Following extensive HIA advocacy on the impact changes to the National Construction Code (NCC) is having on construction productivity and business red tape, the Australian Building Codes Board (ABCB) has released a discussion paper seeking industry views on opportunities for modernising and reforming the NCC.
“Reforms to Queensland’s restrictions on new home building will see more new homes commencing construction, adding revenue to the state and Australian governments, and assisting the task of increasing housing stock,” said Tim Reardon, HIA Chief Economist.