Brief Report- Construction Industry NT
Residential Construction Northern Territory
The total dwelling completions for Northern Territory for the year ending June 2015 was 2,661 and the projected completions for year ending June 2016 is 1,909. The Northern Territory has over built to a stock deficiency of -2.6% in 2015 which is predicted to continue at a rate of -3.8% in 2016 and -4.0% in 2017. The result is the estimated underlying demand for new dwellings by June 2016 will only be 720 new dwellings.
Predictions suggest that commencements could drop by over 50% from January 2015 to January 2017 with the largest drop in the private other category of dwellings. Predictably the real house price in Darwin could drop 9% over the same period.
Non-Residential Construction Northern Territory
The lowest population of any Australian State or Territory but with a considerable area undeveloped ensures that there will always be a volume of infrastructure work to sustain the market and much of that civil engineering. However, the private investment projects that drive the office market will continue to register a downturn from the heady market of 2013-2014 back to the same levels of 2010-11. This represents over 100% of the value of the increase from 2010 being wiped from the market by June 2016.
The value of warehouse construction will also decrease from June 2015 to the levels of 2010 with 70% wiped from the gains in the market. Several large retail projects will continue and fuel that sector but it will be timing of when these projects commence.
The prediction is from current activity, a slight bounce back of approximately 20% by June 2016 then a drop of 5% before an upturn in late 2016 into 2017. Certainly the strong market investment in non-residential work peaking in 2012 is not forecast to re-appear any time prior to 2017.
Total Building – Northern Territory
The value of total commenced between June 2015 and June 2016 is predicted to fall 9% with a slight upturn in 2017 driven by non-residential building in the retail sector.
Note of Interest
Victoria recorded the highest number of commencement 2014-15 with an Australian record for any State of over 64,000 representing 12% growth for the period. Why an increase in high and medium density? Availability of affordable land close to the city and easing of planning restrictions.
Provided by Callan Coulter Consulting with reference to ABS and BIS Shrapnel publications.
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