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Construction almost maintains record activity

 

The Australian Performance of Construction Index (PCI) lost 2.7 points from March’s record highs, yet April 2021 still saw all four segments indicate continued growth.

Conducted by the Australian Industry Group (AiG) and the Housing Industry Association (HIA), the PCI saw its construction activity index jump to its own record high of 62.8 points (where scores above 50 indicate growth).

This record came as home builders rush to take advantage of newly approved HomeBuilder grants.

HIA economist Tom Devitt said the surge of projects allowed by the HomeBuilder scheme should maintain the construction industry in the near-term, and in turn, the extractive industry should feel the benefits.

“The uptake of HomeBuilder has beaten all expectations,” Devitt said. “The extension of HomeBuilder’s commencement deadlines means builders will be able to meet much more of this record demand over the coming year and fewer homebuyers will have to suffer the disappointment of cancellation due to capacity constraints.

“This will support home building activity for several years before the current absence of population growth spreads from the apartment sector to the rest of the housing market.”

AiG head of policy Peter Burn echoed the sentiment that demand should remain for a good year, as the new orders index remained at 57 points.

“Across the industry, employment and new orders were both higher in April although their expansion was slower this month,” Burn said.

“Apartment building and commercial construction were again in positive territory, although with current growth coming after long periods of contraction the levels of activity remain relatively modest.

“New orders were strong once again on the back of the house building and engineering construction sectors, suggesting continuing healthy levels of activity in the months ahead,” Dr Burn said.

Construction activity in housing (69.7), apartment (54.6) and engineering (63.8) all rose in April, while commercial activity dropped to become the lowest of the four segments at 51.4 points.

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