Over 300 builders, suppliers and other professionals jostled into the Brisbane Convention Centre for HIA’s annual State of the Nation breakfast in Brisbane on Tuesday morning.
With the TGB team on site, Peter Loves gives the official Good Builder event recap.
Senator Matt Canavan kicked off the event proceedings. However, do keep in mind it is an election year, and he wasn’t overly eager to create any headlines for Mr Dutton to deal with.
He did state that to meet our housing goals, we need to stop building up the big 5 cities and develop regional cities with the right infrastructure to support populations over 500,000.
It’s a strong point if only there were the necessary funding commitments for the infrastructure in these fictitious regional cities.
Over to the HIA Chief Economist, Tim Reardon, in a dashing brown suit, to take us through exactly what is going on in the market locally.
The Key Takeaways:
- It’s a rosy outlook, and everyone wants to be in Queensland
With an estimated net population growth in SEQ of about 60,000, the region is expected to have a healthy level of demand for new homes over the next few years. The forecast shows that new home sales will increase for the next 18 months.
(Queensland is trending in the right direction)
(Everyone is moving to Queensland)
- Unfortunately, trade shortages are set to worsen
Trade availability has improved since 2022, but remains challenging in many areas. As the market picks up further, it’s only set to get worse.
(Shortage is not yet returning to surplus)
(Shortage across all fronts)
- 41% of the cost of a new home is taxation in Brisbane
For the average punter buying land and building a house, 41% of the total cost is federal, state or local taxes or regulations. Over the past 5 years, it has doubled to an average of $348,000. Save for abolishing GST on construction costs, (which will never be considered in parliament), there don’t seem to be too many solutions for this one.
(The percentage change in costs is real)
- Reno’s are going strong
Make hay renovation builders!
(A positive trend seems to be emerging)
- Is there any impact on home-building when it comes to Trump and tariffs?
All the international chaos shouldn’t result in too much disruption locally.
We may see a dumping of timber and steel locally if Trump’s tariffs hold, resulting in a potential lowering of prices, but retaliatory tariffs from our side may only increase our material costs here locally.
The consensus around tariffs was,
“Don’t pick a fight with the crazy guy at the bar”.
Well put I thought.
- How much land do we have left?
From what he has seen, Tim put forward that there is less than 18 months of available land across South East Queensland (SEQ), with the further challenge that there is no accurate available data to confirm this.
There is a drastic need for up to date data on exactly how much land is available and developable so that the governments can make the right decisions here.
- Who is going to pay for infrastructure?
A major theme, which had all speakers up in arms, is the fact that right now, buyers of new land are the ones paying for the new infrastructure and the upgrades of the whole community, including existing residents and public housing. The cost of community enabling infrastructure needs to return to the Government.
Final thoughts?
Getting a view of the broader economic picture is good for the soul from time to time.
Hat’s off to the HIA for a quality event and Tim Reardon for an in-depth look at the current state of play. It’s an event well worth getting around next time it’s in town.
Author: Peter Love
Pete was the General Manager of one of Australia’s largest home builders for six years, before starting his own business as a buyers’ advocate, building over 200 homes in five years across South East Queensland and working with over 20 builders to deliver them. Across this time he has seen most facets of the industry, the good, the bad, and the beautiful.
0 Comments