Victorian Building Activity Shows Progress, Challenges Remain

Building activity has risen in Victoria despite ongoing challenges the property industry is facing, including a harsh taxation regime, planning delays and the rising costs of building materials.

New data from the Australian Bureau of Statistics (ABS) shows that 14,266 dwellings were completed during this quarter, up 231 completions in the last quarter, yet still short of the national goal set for Victoria of 15,392. Meanwhile, work on 15,503 dwellings commenced in the last quarter, up 3200 from the last quarter.

Victorian Executive Director Cath Evans says that while the increase in both statistics is encouraging, this is not the time for governments to rest on their laurels.

"While we welcome the news that dwelling commencements and completions are on the rise, the fact is that just under 60,000 homes have been completed in the last 12 months, which is still 20,000 short of the Victorian Government's annual housing target," Ms Evans said.

"Victoria is the fastest growing state in Australia, and we need to have the right blend of policy reform and ambition to ensure we meet those targets.

"We recently welcomed the extension of the off the plan stamp duty exemption for units, apartments and townhouses, but there needs to be further tax relief that drives down costs for industry and increases the feasibility of new housing projects.

The results come just weeks after Victoria's property sector again recorded the lowest confidence levels in the country.

Data from the Property Council / Procore Industry Sentiment Survey shows the state's confidence index dropped to 104 - a four-point decline since March and now 20 points below the national average of 124.

Victorian respondents report mostly negative views on the state government's performance, particularly planning and managing growth, which is the lowest nationally. Six in ten say property taxes and charges are the most critical issue the Victorian Government must address.

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