Stellar Victorian residential building sector forecast to slow as NSW catches up

Residential builders in Victoria have experienced a high level of activity over the past five years - the envy of all other states, according to the Australian Construction Industry Forum.

But its latest forecast report suggests that this high level of activity won't be sustained over the next three years (2013-2015) as the state falls in line with an improving NSW residential building sector.

This may leave local home builders in Melbourne and Victoria lamenting their businesses’ decline when compared with past good times. But the better news is that, after a period of moderation, the residential building industry will resume good growth.

“It’s important for the Victorian building and construction industry to see the bigger picture and not to panic – the sky is not falling -  however the surging business they have enjoyed in the past will pull back to a more usual level,” says ACIF executive director Peter Barda.

“The ACIF Forecasts point to Victoria returning to pace with New South Wales, with Queensland close behind, cooling back from a surging local industry over the past five years,” he says.

“The Victorian building and construction industry can see the bigger picture of demand for their services by referring to good quality industry data.

“ACIF Forecasts are generated by data and facts, but also by local knowledge of what is really happening in the economic and social marketplace that drives Victorian building and construction.’’

The chart shows how a strong period for the Victorian residential sector has been out of kilter with the other states, and how it is returning to pace.

While the growth curve has changed, it is generally an upward trend for Victorian residential building.