We learn less than usual from history in the COVID-19 environment. The outlook for housing starts is very uncertain, as is the case for the broader domestic and global economic dynamic. Recent new home sales fell by 22.8 per cent in the two months following the introduction of tough pandemic social restrictions, triggering a wave of project cancellations that could derail the economic recovery in 2021.
Builders and subcontractors were also forced to slash their rates and forgo profits as contract work dries up in the wake of the economic slowdown.
While these numbers present a mixed position for housing, the initial forecasts tell a different story.
Key forecasters provide low forecasts for new housing delivery
HIA F2021 – 111,510 commencementsvi
MBA F2021 – 115,822 commencementsvii
UBS F2021 – 100-120,000 commencementsviii
Source: Powerhousing Australia: Australian Affordable Housing Report F2021