Housing In Demand
Newcastle Herald
Friday June 1, 2007
HIGHER housing demand and increased consumer confidence will provide the spur for economic growth in the Hunter during the second half of 2007.
But increased costs in building a new home will continue to constrain the upswing in building activity, analysts say.Hunter Valley Research Foundation research fellow Caroline Veldhuizen and Master Builders Australia chief economist Peter Jones addressed 100 builders and business leaders yesterday on the Hunter's economic outlook. Leading economic indicators point to signs of a re-emergence of confidence among business people and consumers in the region.Despite many builders believing the industry had "flatlined", there were positive indications that demand for new housing would rise towards the end of the year and into 2008.Ms Veldhuizen said that, after two years of consistent decline across NSW, data suggested there would be a lift in housing demand in the Hunter. Approvals for non-residential construction in the area remained strong.A turnaround in the property market was an important indicator for the region's overall economy, but Ms Veldhuizen said it was too early to tell if the upward trend would be sustained. Factors such as housing affordability, interest rates and a shortage in supply of homes were all pivotal to a resurgence in the building industry being sustainable.The outlook for the Hunter economy was positive, with Mr Jones saying the emerging recovery in the housing sector should gain traction during the remainder of this year.
© 2007 Newcastle Herald