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Homebuilding has been forecast to fall by 7.8 per cent during the next two years while renovation activity is expected to grow by 2.4 per cent.
The Housing Industry Association has forecast that 184,300 new homes will be built in 2014, which would be 9.6 per cent higher than last year’s result.
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However, that number is expected to fall by 4.4 per cent to 176,200 in 2015 and another 3.5 per cent to 170,000 in 2016.
There are also expected to be 29,100 renovations in 2014, which would mark 3.9 per cent growth from 2013.
Renovations are then forecast to grow 1.3 per cent to 29,400 in 2015 and another 1.2 per cent to 29,800 in 2015.
Housing Industry Association chief economist Harley Dale said Australia’s new homebuilding market has been performing strongly, although inconsistently.
“The current recovery in residential construction still masks considerable differences in conditions across states and territories, and in terms of building type, for both new housing and renovations activity,” he said.
“A further broadening of the recovery would certainly be a desirable outcome.”
Dr Dale also said there is evidence to suggest that renovations investment is mounting a sustained recovery from the decade low reached in 2013.
[Related: New home approvals have peaked, says housing group]
