Favourable time to build residential real estate
Those thinking about property investment may wish to consider building a residential real estate or home, instead of buying real estate.
With subdued growth in the construction industry, availability of skilled labour has gone up and prices for labour and material have become more affordable.
Recently lowered interest rates should also contribute to favourable buying conditions – the Reserve Bank of Australia just slashed the official cash rate by 50 basis points to 3.75 per cent.
New South Wales
The Housing Industry Association (HIA) recently reported subdued land sales for the state of New South Wales, reflecting favourable conditions for building residential real estate.
“The volume of residential land sales across a majority of regions in NSW signals further declines in new home building activity this year,” said HIA executive director for NSW, David Bare.
With lower interest rates, low demand and affordable skilled trades, land development and residential property building may be the wiser choice for NSW property investment.
South Australia
The HIA also released results of a survey of building and subcontractors that indicates low demand for residential skilled trades in South Australia.
Entitled the HIA Trades Report, the outcomes reflect demand measured for the March 2012 quarter.
HIA SA regional director Robert Harding found positive aspects of sluggish activity in the industry and encouraged potential property builders to consider home construction.
He said: “The increasing availability of trades and the static movement in trade prices taken with the Reserve Banks significant easing of the base interest rate announced yesterday, (May 2) provides an ideal time for consumers to enter the building market.”
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