Residential construction activity has recorded its sharpest quarterly decline in almost a decade but there are hopes that new home incentives should turn the trend around in the near future.
Residential building activity slumped 6 per cent in the March quarter, the ABS said yesterday.
Total construction, including non-residential building and engineering activity, was down 3.7 per cent compared to the December 2008 quarter.
Despite the bleak result HIA chief economist Harley Dale said the First Home Owner Boost for new homes and low mortgage rates would help to reverse the decline in new building activity.
“Leading indicators signalled long ago that the first half of 2009 would be a weaker period for new building activity. The substantial stimulus in place creates a strong prospect for this situation to reverse later in the year,” he said.