Housing construction costs continue to rise

State-by-state breakdown

NSW

September NSW CHIP Index: 291.5

Quarterly Growth: 1.2 per cent

Annual Growth: 4.3 per cent

VIC

September Vic CHIP Index: 279.3

Quarterly Growth: 1.2 per cent

Annual Growth: 3.9 per cent 

QLD

September Qld CHIP Index: 304.7

Quarterly Growth: 1.0 per cent

Annual Growth: 3.4 per cent

WA

September WA CHIP Index: 284.9

Quarterly Growth: 0.8 per cent

Annual Growth: 2.7 per cent

SA

September SA CHIP Index: 267.1

Quarterly Growth: 0.5 per cent

Annual Growth: 2.6 per cent

The research also pinpointed the “market influencers” driving this trend. It found that growth in employment within the construction industry is a key influencer, with employment rates increasing 1.2 per cent over the three months to August 2019, rising 0.5 per cent year-on-year. Over the past five years, employment in the construction industry has increased by 14.1 per cent, ABS statistics showed.

Another key influencer was touted as the RBA’s decision to lower the cash rate to record-low levels. 

“Lower interest rates, together with a subtle loosening in credit policies and improved housing sentiment, [have] seen the housing market make further progress towards a recovery,” CoreLogic said.

Furthermore, dwelling approvals trending lower was also identified as a key influencer. According to CoreLogic, dwelling approvals are down 19 per cent in comparison with last year. “However, stronger housing conditions should help support the residential construction sector over time.”