October 23, 2017
Housing and construction activity lagging in WA
The latest Commonwealth Bank State of the States report demonstrates the short-sighted nature of the McGowan Government’s decision to scrap the $5000 increase to the first home owner grant, according to Opposition Leader Mike Nahan.
“Falls in construction work, dwelling starts and dwelling finance are clear signs of the need to maintain stimulus within the WA housing sector,” Dr Nahan said.
Western Australia was one of only two state economies to have construction work lower than a year ago. Construction work in WA fell by 30.5 per cent and the Northern Territory by 3.9 per cent.
Dwelling starts in Western Australia were also at their lowest lowest levels in almost five years and down 18.7 per cent from the decade average, only the Northern Territory recorded a lower level.
Housing finance commitments in WA were also down 12 per cent on the decade average.
“These figures should make worrying reading for the McGowan Government,” Dr Nahan said.
“The former Government in December 2016 announced a $5000, 12-month-long boost to the first-home owner grant because it recognised the need to help first homebuyers enter the property market and to stimulate construction in the WA housing market.”
The McGowan Government scrapped the increase after just six months, despite modelling which showed it would create an estimated 2,000 new construction jobs and FHOG application data showing it was having a significant stimulus on the housing industry.
The latest State of the States report also showed the WA economy continued to lag other state economies, with annual growth rates remaining below national averages on seven of eight indicators surveyed.
The next worse performing jurisdictions were Northern Territory, which underperformed on six indicators with South Australia and Queensland which both underperformed on four indicators.
In retail trade, Western Australia lost two positions in the national rankings, while wage growth in WA remained the lowest in the nation at 1.4 per cent.
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