Greg Hankinson , Director - Metropole Constructions
If you’ve been keeping an eye on the construction market – or simply thinking about building or renovating – there’s some news worth paying attention to.
According to CoreLogic’s latest Cordell Construction Cost Index (CCCI), construction costs grew at their slowest pace in 15 years over the March quarter, which is great news after a period of rising costs over recent years.
According to the index, residential construction costs only grew by 0.4% nationally over the March quarter. That’s a big shift from the past two quarters, which both saw 1.0% increases.
Looking at the bigger picture, the annual rise in costs is now sitting at 2.9%, which is a pretty significant drop compared to previous years.
Why the slowdown? It seems like several factors are at play here. The industry has been riding a bit of a rollercoaster over the past few years, with COVID-19 sending costs up by over 31% during its peak.
But those pressures have now eased with plenty of optimistic signs in the mix. Property values have started to rise again, and approvals for new dwellings are trending upwards as well. This will open up opportunities for both builders, property developers, and homeowners to consider new projects.
Queensland had the highest quarterly growth, according to the index, with a 0.6% rise in costs, followed by Western Australia (0.5%) and New South Wales (0.4%).
While costs are still increasing – albeit marginally – the slower pace provides plenty of upside potential for everyone involved.
So, whether you’re a builder, property developer, a homeowner, or just someone watching the market, this slowdown should spell opportunity.
If you’ve been waiting for the right time to start building, it might be closer than you think.
Plus, with property values on the rise, investing in a new build or renovation right now will ultimately pay off in the long run.
