Good news for builders and subbies, with building and engineering construction rising for the first time in five months.
The Ai Group and Housing Industry Association Performance of Construction Index (PCI) rose to 53 points in February, up from 47 points the previous month.
What do those figures actually mean? Well any figure above 50 means that activity has grown, so the jump from below 50 to above 50 is a good thing!
The February result was the highest since mid-2016, and the first above 50 since September.
The house building subindex increased to 60 points, making detached home building the star performer.
“There was a healthy lift in new orders for house builders with some additional expansion experienced among engineering constructors,” Peter Burn, head of policy at Ai Group said.
“The gains offset the decline in new orders in the apartment sub-sector and underwrote a solid lift in overall employment in the industry as businesses increased their capacity.”
Apartment building was a different story, with this subindex at 46 points, meaning activity is shrinking. It is still pretty high by historical standards though.
“The gem in today’s result — for manufacturers, suppliers, subcontractors, builders and the many other market participants — is the relatively strong showing for detached housing,” HIA chief economist Harley Dale said.
He said the latest reading supports the view that new home construction activity will hold up quite well in the short term, after which there will be a marked decline in medium-to-high density construction.
So great news if you’re a builder or subbie. How’s business going for you out there? Let us know in the comments!