Its Over, page-12808

...you'd think that the construction sector has had a pretty tough time, lockdowns meant delayed completion and post-pandemic we had material costs shooting skyhigh while labour supply is constrained..and then rates are going higher.

...that's why Metricon surfaced as having problems, under fixed price contract..and there's more to the story than what can be publicly made known.

Construction unexpectedly declines in March quarter
Michael BlebySenior reporter
May 25, 2022 – 12.54pm


Housing, non-residential and infrastructure construction all declined in the first quarter, defying expectations of growth and casting a cloud over next week’s first quarterly GDP numbers.

Home-building contracted 0.9 per cent as a drop in detached housing offset a pick-up in apartments, non-residential work fell 1.8 per cent and engineering work slipped 0.4 per cent, official figures on Wednesday showed.


Going up slowly: Shortages and delays hampered home-building in the first quarter - but the industry says this will prolong activity, even as interest rates rise.  


The overall 0.9 per cent decline contradicted economist expectations for 1 per cent growth across the industry after a revised 0.6 per cent increase in the December quarter – initially reported as a 0.4 per cent decline – and showed that building materials constraints and COVID-19 labour shortages are delaying projects.

“In a usual cycle, we would expect moderate quarter-on-quarter growth to be showing at this point,” said Tim Hibbert, BIS Oxford Economics’ head of property and building forecasting.

“The inability to gain traction on-site, compounded by a backdrop of strong demand, has resulted in a swelling backlog of construction work that may take until 2023 to peak.”


State by state, the biggest declines occurred in South Australia (minus 5 per cent), Queensland (minus 4.4 per cent), and NSW (minus 1.6 per cent), with floods having a significant impact in the latter two jurisdictions.

Post-flood rebuilding would increase localised materials and labour shortages, Mr Hibbert said.


The Housing Industry Association, which on Tuesday said materials and labour shortages would stretch out building time frames, triggering a “shallow” 20 per cent decline in home building over the next three years, took a glass-half-full response to Wednesday’s official figures.

“There is still an enormous pipeline of work to complete across all regions,” economist Tom Devitt said.

“This will sustain elevated levels of building activity through to December 2023 and beyond, even with interest rates on the rise.”