What does the budget mean for us? There is no denying that this is a ‘tight’ budget, but what does that mean? “There will be some negative impact on economic growth. The budget relies heavily on spending cuts to achieve its targets. Consumer confidence will almost certainly be damaged by this budget.” Harley Dale, 14/5/14 The question is what happens to real activity in 2014/15? There are three keys:- –Residential construction –Business investment –Budget is only part of the process
NSW – new housing is finally ripping along New housing starts hit nearly 45,000 last year, the highest in a decade. Starts are likely to exceed 50,000 in 2014. There are 11 ‘growth’ regions out of 13.
NSW – renovations have been awful Growth of 5 per cent in 2014, 4 per cent in 2015.
Victoria – new housing is down but not out New housing starts fell from over 60,000 in 2010 to 47,000 last year. Starts are likely to hold steady in 2014, but decline further in 2015. Land sales suggest a turnaround in most regions.
Victoria – renovations top the nation Activity to ease by around 2 per cent in 2014 and 2015.
Queensland – new housing on the recovery trail New housing starts went back over 30,000 last year. Starts are likely to reach around 38,000 in 2014, the highest level since 2008. Regional markets bottoming out or picking up, except Mackay and Rockhampton.
Queensland renovations bottoming out Growth of 5 per cent in 2014, 4 per cent in 2015.