Housing construction has slumped, despite population growth.
HOUSING construction slumped further into the doldrums with new dwelling starts falling for eight straight quarters despite Australia's population growing last year.
In the three months to March, housing starts across the country were down by 12.6 per cent.
In New South Wales, they were at their weakest since records began, worse than the 1991 economic recession and 2007 global financial crisis, economists said. ''If you're not building mines or major infrastructure like that, there's a massive chasm over the next 12 months,'' said Macquarie Bank chief economist Brian Redican.
''We've already seen pressure on quite a few construction companies and you would expect that to really escalate in the second half of 2012.''
Preliminary estimates from last year's census data shows Western Australia was the engine for much of the nation's population growth.
Last year it grew at almost twice the pace of any other Australian state, adding 67,400 people (more than Queensland), a growth of 2.9 per cent. Across the country, we grew by 302,600 people to 22.4 million, up by 1.4 per cent.
But those extra people were not enough to jump-start home building: dwelling commencements over a similar period (the year to March) fell by 24.5 per cent, to a total of 141,403 homes over the 12 months.
In the booming west, the mismatch is putting pressure on rental rates. WA had 22.3 per cent of the country's population growth but just 13.3 per cent of housing starts, which have shrunk by 15 per cent over the past year, from 5133 in the March quarter of 2011 to just 4360 in the same period a year later.
But Australand's residential executive manager, Rod Fehring, questioned whether all those extra bodies needed accommodation.
Fly-in, fly-out contractors needed a West Australian address to work, he said. ''They show up on the headcount. The question is whether they are permanent residents or not?''
Most of Perth's excess housing supply that had built up over the past 18 months had only now been absorbed, he said. ''We're just only now seeing a break out of new supply, but it's patchy,'' he said.
Housing starts also declined in all other states. In NSW, in the March quarter they slumped 41 per cent below the same period a year before.
That drop was partly explained by a decline in apartment projects, Housing Industry Association chief economist Harley Dale said. ''But it's unequivocally weak regardless of the NSW outcome,'' Mr Dale said.
Victoria, until recently the engine of much of Australia's housing activity, started construction on nearly as many new dwellings as NSW and Queensland combined.
But it too has slowed considerably, from 14,254 starts in the March quarter last year, to 11,204 this year, a drop of 24 per cent
