A national housing report card has reinforced the ACT’s status as a safe haven in a COVID-19-affected economy, with the Territory leaping into top spot.
The Housing Industry Association (HIA) report card on the relative performance of state and territory housing markets also reveals the ACT’s increasing desirability as a place to live and work.
The HIA Housing Scorecard report presents analysis which ranks each of the eight states and territories based on the performance of 13 key residential building indicators, including detached and multi-unit building activity, renovations, housing finance, and rates of overseas and interstate migration.
HIA ACT and Southern NSW executive director Greg Weller said the ACT has performed exceptionally well to move from as low as sixth in the table in recent reports, to the number one position for the first time since 2014.
“The performance by the ACT is very positive in the respect that it points to a degree of upside in the market, with a number of leading indicators being quite strong, including housing finance and approvals,” he said.
“The ACT was first in the nation for loans to non-first home buyers and second for loans to investors, while it was also first for approvals for multi-unit and second for approvals of alterations and additions. This points to a longer term strength in the housing market in the capital.”
But the detached housing sector continues to sag in a market dominated by apartment construction.
“A worrying aspect remains the underperformance of detached housing, with approvals in last place, while commencements is fourth last,” said Mr Weller.
“This is no doubt related to the stellar performance of HomeBuilder in other states, but 2020 will also likely reflect the second year running that the monthly average approvals in the Territory have fallen below 100, which is something that needs to be addressed.”
Mr Weller said it is unsurprising that multi-unit developments continue to underpin the ACT market, which is also in first place for ‘under construction’.
The ACT has remained the strongest multi-unit market in Australia for all but one quarter since late 2018.
The Territory has also jumped from last and second last for net interstate and overseas migration, respectively, to first place for both.
“This reflects the movement of population from larger capitals to the ‘safe haven’ of regional areas, whether to take advantage of new opportunities to work remotely or to return home due to loss of work in tourism or hospitality,” said Mr Weller.
HIA economist Tom Devitt said the ACT had benefited from steady population growth and a stable labour market when compared to other jurisdictions.
“This has supported strong demand for new homes and renovation activity, which has been boosted by the HomeBuilder program,” he said. “Activity in the first-home buyer sector has also grown strongly.
“The economic disruption in 2020 reshuffled the Housing Scorecard rankings. The relative strength of residential building activity across the states and territories will be heavily influenced by the take-up of HomeBuilder and other stimulus measures in 2021.”