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    Default High-rise plunge in Queensland hits housing starts

    HOUSING starts suffered their biggest fall for nine years in the December quarter, dragged down by a savage 54 per cent fall in the number of high-rise apartments under construction in Queensland.

    Sods were turned on 32,637 houses and apartments around the country in the December quarter, down 10 per cent on the September quarter, which was itself down 9 per cent on the June quarter.

    However, the December figures from the Australian Bureau of Statistics are expected to mark the steepest decline of the cycle. A cumulative four-percentage-point cut in interest rates and greater incentives for first-home owners are expected to draw home buyers out of their shells.

    "If you take out the plummet in unit starts in Queensland and WA, a large part of the quarterly result is accounted for," said Housing Industry Association chief economist Harley Dale.

    The southeast Queensland housing market was hit hard last year as highly priced product collided with high interest rates early in the year, Mr Dale said.

    The Gold Coast market had suffered most as buyers turned away and as several Gold Coast companies such as the Raptis Group failed.

    In Brisbane, the $1 billion Vision apartment and office project - one of the first to put its hand up for help from the "Rudd Bank" - was put on hold in November. If built, the CBD tower will have 401 apartments.

    "The larger drop in multi-unit starts confirms that the credit crunch is having a disproportionately negative impact on the high-rise apartment sector," Mr Dale said.

    December quarter dwelling starts plunged 25 per cent in Queensland, 13 per cent in South Australia, 9 per cent in Western Australia, 5 per cent in Victoria, 3per cent in NSW and 1 per cent in the ACT. They were up 1 per cent in Tasmania and jumped 93per cent in the Northern Territory - the result, suggested Mr Dales, of starts on a few large projects in a relatively small market.

    Despite the gloomy December-quarter figures, analysts see a rise in housing starts by June.

    JP Morgan economist Helen Kevans predicts housing starts will begin to rise in the March quarter, while Mr Dale believes it will take until the June quarter for an improvement to show. Falls of the magnitude of last year would be a surprise, he said.

    Ron Loney, managing director of Queensland home builder Ausbuild, said the company felt the worst of the downturn between March and August last year.

    He said that in the December quarter, Ausbuild took 45 per cent more deposits than in the previous three months and he expected those figures to rise again in the March quarter.

    Source: http://www.theaustralian.news.com.au...25658,00.html?


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