Housing construction recovery takes backward step

THE burgeoning housing recovery took a backwards step late last year, with new data showing a 1% fall in construction work completed in the December quarter.

Figures from the Australian Bureau of Statistics released Wednesday also confirmed a 2.5% fall in the value of residential building work on new homes, disappointing the construction sector.

Housing Industry Association economist George Murray said while the industry saw "good things across a number of leading indicators", the data confirmed the speed of the recovery had been "overstated".

He said there remained a need for policy reform to support housing, if the industry is "to make the expected contribution to economic growth".

Masters Builders Australia chief economist Peter Jones echoed Mr Murray's sentiments, saying the data showed "almost zero growth from a year ago".

"The performance of the bellwether construction industry will be a litmus test for the rebalancing of the broader economy as the mining boom deflates," he said.

"Confidence is fundamental to the wellbeing of the building and construction industry and its capacity to contribute to economic growth and jobs."


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