Population growth to spur a building boom in regions
KEY regional areas around the country are set for a building boom on the back of local population growth, a report from economic forecaster BIS Shrapnel reveals.
The Regional Building 2013-15 report shows some of the top areas set for growth were Grafton, Coffs Harbour, Toowoomba, Richmond-Tweed and outback Queensland.
But while those regions can look forward to solid housing growth, public sector cuts and the slowing mining sector will lead to a fall in building activity in other areas.
At the top of the league table, the Coffs Harbour-Grafton region is set for building growth as high as 52% next year.
BIS Shrapnel associate director Kim Hawtrey said the region was an attractive lifestyle and retiree region, and as such was likely to lead the way with building growth.
"It has an older age profile, with a median age of 44 compared to 38 across New South Wales as a whole, and has a significant lifestyle and retiree component to demand," she said.
"After the Global Financial Crisis home building in the region dropped, an experience shared with many similar destinations, and now we find there is an undersupply of homes."
According to the report, growth will return to areas such as Coffs Harbour-Grafton in 2013/14 and beyond, taking activity back towards the pre-GFC levels."
In other NSW regions, the Richmond-Tweed was forecast to see home building grow 24%, while the Newcastle-Lake Macquarie area can prepare for 19% growth.
The Sunshine State also peppered the top 20 growth areas, with Wide Bay and Toowoomba likely to have an up-tick in activity.
Mr Hawtrey said the Wide Bay region was a key lifestyle destination, with tourism a key to the local economy.
"We expect continued strong economic activity to drive a pick up in home construction in regions such as Wide Bay (forecast to be up 16%) and Toowoomba (up 12%) in 2013/14 and beyond," he said.
However, despite the good news, building activity in areas such as the resource-rich Pilbara and Kimberley in Western Australia are expected to decline.
As mining investment continues to fall, home building in the Pilbara is set to drop 36%, with another 22% fall likely for the Kimberley.
Top 20 growth areas:
Coffs Harbour- Grafton: 52%
NT (outside Darwin): 50%
WA Goldfields: 34%
WA Wheat belt: 29%
NSW Mid North Coast: 27%
Greater Brisbane: 22%
Newcastle - Lake Macquarie: 19%
WA Mid-west: 18%
Wide Bay: 16%
Outback QLD: 12%
NSW Murray: 12%
Greater Sydney: 10%
SA Yorke Peninsula: 9%
SOURCE: BIS Shrapnel Regional Building 2013-15 report