Latest news with #TomDevitt
West Australian
16 hours ago
- Business
- West Australian
Aussies exit NSW, WA hits 3 million population milestone
More people are fleeing NSW than any other state in Australia. Population data released by the Australian Bureau of Statistics this week shows 28,118 people left NSW in 2024. Western Australia tipped over three million people for the first time as the resource-rich state recorded the highest nationwide growth rate. At the end of 2024, 27.4 million people called Australia home, an increase of 445,900 on the previous year and representative of a 1.7 per cent increase. Commonwealth Bank economist Lucinda Jerogin said population growth had slowed quicker than anticipated on the back of the post-pandemic peak. 'A slowdown in natural increase continues to place a drag on Australia's population growth,' she said 'Cost-of-living pressures, rising female workforce participation and broader uncertainty are likely driving this downward trend. 'Growth in deaths are outpacing births leading to the decline in natural increase.' The data shows NSW lost more than 28,000 people to net interstate migration, with 112,763 people leaving for elsewhere in the country. Queensland picked up more than 106,000 people from other states for a result of nearly 26,000 fresh faces. Nearly 40,000 Aussies moved to WA for a net increase of about 12,500 people. While Queensland and Victoria's total populations grew by 1.9 per cent, WA's grew 2.4 per cent. The population of every state and territory grew by at least 1.1 per cent, except Tasmania, which recorded a 0.3 per cent increase. 'Within Australia, people are continuing to leave NSW, and to a lesser extent Victoria and the smallest jurisdictions, and head into Queensland and WA,' Housing Industry Association economist Tom Devitt said. 'But even the jurisdictions losing residents interstate are absorbing enough overseas arrivals to see their populations expand.' State governments needed to do more to stimulate housing construction, he said. 'Foreign capital is highly liquid. State governments have forced institutional investors into building apartments in other countries,' Mr Devitt said. 'As a consequence, multi-unit construction volumes in Australia have halved, likely costing state governments tax revenue.'
News.com.au
4 days ago
- Business
- News.com.au
HIA: stamp duty behind 500,000 less homes, $40k home loan hit
A desperate Aussie home buying tactic is costing owners upwards of $40,000, and it's largely because of their state government. A new Housing Industry Association report has revealed some of the jaw-dropping hidden costs of stamp duty taxes around the nation, including the added whack for purchasers who opt to borrow the money needed to cover the upfront tax. The Association's Stamp Duty Watch report released yesterday called for changes to the tax nationwide if Australia is to reach its 1.2 million new homes National Housing Accord target, but especially for states hitting foreign investors with the biggest additional costs. Australia's worst neighbours exposed Their figures indicate higher tax bills for foreign property investors had wiped out more than 500,000 new home builds nationwide across the past decade — significantly exacerbating the nation's current housing and rental crisis. For local homebuyers, HIA senior economist Tom Devitt said their calculations showed the typical homebuyer who borrowed to cover their stamp duty would be paying more than $40,000 in extra stamp duty costs in NSW, Victoria and South Australia. Stamp duty costs are set independently by state governments. Over the course of a 30 year loan at a 6.55 per cent average variable rate, Victoria's nation-topping 5.3 per cent stamp duty cost for a $729,000 typical home leads to a $38,810 stamp duty payment. Put that on your mortgage and it would cost you another $48,229, for an eye-watering total north of $81,000. Nationally, the average added cost would be $38,786 — on top of an initial $31,211 stamp duty for a $785,000 home. Queensland has the lowest stamp duty cost in the nation at 2.7 per cent, or about $21,220 for a $786,000 typical home. Adding that sum to your mortgage would add about $26,370 to the final mortgage bill over 30 years. Mr Devitt said that the added money lost from budgets would also lead to 'opportunity costs' — as households lost the option for investing the money instead, or for putting it towards other things such as holidays. The alternative for many homebuyers is to compromise on home features or location. While a smaller back yard was unlikely to have significant ramifications, Mr Devitt said a longer commute would not only cost owners more in petrol — but also came with 'environmental costs as people spend more time on freeways'. Smart Lending managing director Melissa Gielnik said it was generally a bad idea for buyers to borrow stamp duty costs. Banks will not allow for it without a guarantor over the loan, typically family, or without the buyers reducing their deposit — which would further increase the size of their mortgage. If a lender did let the buyer do it, there was a significant chance they would be facing lenders mortgage insurance costs they might have otherwise avoided. While scrapping the much maligned tax wouldn't directly add to the cost of homes, Ms Gielnik said it was likely a way would have to be found to stop vendors becoming greedy and demanding more money from prospective buyers — or prices would rise. The stamp duty costs for foreign investors have also had significant impacts on the nation's new home supply. HIA chief economist Tim Reardon estimated that with the number of new multi-unit dwellings effectively being halved for the past decade since state government's began adding additional stamp duty costs for foreign investors in 2015, Australia had missed out on more than 500,000 new homes. 'That would have had a substantial impact … if they had all happened, rental price growth would have been 2-3 per cent a year, rather than the 5-15 per cent that we have seen,' Mr Reardon said. 'We would be seeing rental vacancy rates above 3 per cent.' The economist added that 'close to 100 per cent' of any additional stamp duty costs paid by international investors developing apartment buildings would be passed on to buyers in heightened costs, or to tenants in higher rents. 'Government's can tax whoever they like, but the impost will be born by the Australian household in the end,' he said. With the federal government increasing migration for much of the past 10 years, the result had been increasing population amid lower incentives for foreign funds to support new builds — driving up home prices as well. The alternative was that they took their money elsewhere. 'If Sydney in Australia is going to tax you, upfront, an additional $160,000 compared to other countries, they (investors) will take that capital elsewhere — it's very liquid,' Mr Reardon said. 'And Australia's mum and dad investors don't have the capital to build apartment complexes,' Mr Reardon said. The economist added that without changes to stamp duty taxes, particularly for international buyers, there was no way for Australia to reach a 1.2 million new homes by 2029 target set as part of the National Housing Accord. FIRB stats show in the 2014-2015 financial year there were $60.8bn worth of Aussie home sales approved to internationals. In the 2023-2024 financial year there were just $6.6bn in foreign residential real estate sales in Australia. Latest stats show that in the first three months of the current financial year the figure was just $1.3bn.
Herald Sun
31-05-2025
- Business
- Herald Sun
Locked out: Generation faces housing crisis catastrophe
Australia's housing affordability crisis has reached code red status as runaway construction costs threaten to permanently lock out a generation of potential homeowners. A new analysis reveals a construction sector in turmoil, with renovation expenses surging a staggering 43 per cent since late 2019 and building material prices remaining stubbornly elevated, sitting 35.4 per cent above pre-pandemic levels. The crisis, driven by a perfect storm of crippling labour shortages, supply chain disruptions, and soaring prices for essential materials is prompting urgent calls for government intervention to prevent a full-blown housing catastrophe. Exclusive data by the Housing Industry Association shows essential materials are bleeding budgets dry, with the cost of copper pipes and fittings skyrocketing by 14.4 per cent annually and 63.4 per cent since the end of 2019. The cost of electrical cable and conduit are equally alarming, jumping 9.5 per cent annually and a shocking 69.7 per cent since the end of 2019. Even the humble clay brick, a cornerstone of Australian construction, has surged by 8.3 per cent annually and 48.4 per cent since the end of 2019, while timber doors rose by 7.4 per cent annually. RELATED 17,000 ads: Aussie tradie jobs no one wants Demolition dilemmas: Aus homes under threat Build new for less: Top spots under $850K revealed Only materials like plywood, steel beams, plastic sanitary ware, reinforcing steel, sheet metal and other electrical equipment saw a reduction in cost between 4 per cent and 9 per cent. However, it's a drop in the ocean, considering the cost of skilled labour, which saw a 5.5 per cent increase over the 12 months to March, with those looking to build now paying 35.5 per cent more for a home than they did pre Covid. To put it in numbers, the average national build cost now is $484,315, according to March figures by the Bureau of Statistics, $18,832 more than the previous year and $152,969 more since pre-Covid in 2020, when the average build cost just $331,346. HIA senior economist Tom Devitt said while the numbers looked bleak, the cost of construction material was starting to stabilise. 'Some of the numbers shared do show a few materials are still going up really rapidly…but the average building materials have actually really slowed. They are still very much elevated from five years ago but they do look like they've stabilised. 'Labor costs are also still increasing quite rapidly but also not as much as they did three years ago. Our trade report two or three years ago had a single year where trade prices went up 10 per cent.' Mr Devitt said while the cost of materials would come down with time, the real concern going forward was ongoing labour shortages. 'The demand is still going to be outstripping the supply of trades unless the government follows through on what they've been paying lip service to in terms of fast tracking in-demand construction trades,' he said. '(So far) nothing has really progressed from that because the number of skilled trades that have been arriving, relative to overall overseas arrivals, has been minute.' The hidden cost behind Australia's homebuilding struggles An analysis by NextMinute, a leading project management software for tradies, recently shed light on the occupations with the highest vacancy rates and the most job ad listings across Australia, revealing a stark disparity between supply and demand in the trade sector. Official figures indicate that motor mechanics, electricians, and welders are among the most sought-after trades, with thousands of vacancies across all Australian states. However, SEEK job ad volumes suggest the demand is far greater, with listings for electricians alone exceeding six times the official vacancy count. Similarly, there are 9749 listings for mechanics and 2706 for welders, reflecting widespread recruitment challenges in the industry. Despite attractive salaries, several trades remain under-represented in global job searches, such as airconditioning and refrigeration mechanics, who earn over $2000 per week. The United Kingdom leads overseas demand, with UK-based workers conducting thousands of monthly searches for Australian trade jobs. NextMinute CEO Alex Jenks said the discrepancy highlighted the ongoing recruitment challenges faced by trade businesses. These shortages are slowing down projects, driving up costs, and putting pressure on business owners,' he said. 'Interestingly, the countries showing the most interest don't always align with the trades in greatest need. 'For example, airconditioning and refrigeration mechanics have over 500 official vacancies, but little international search activity, pointing to blind spots in global awareness of Australia's workforce needs.' Australia needs to think modular With Australia forecast to fall 262,000 homes short of its national 1.2 million housing target by 2029, Ray White Group senior economist Nerida Conisbee said a modular approach was needed to address ongoing construction concerns. 'It's taking things like trusses off site and making it more of a manufacturing process, as opposed to building them on site where you need far more skilled labour,' she said. 'Another example would be kitchens and bathrooms which are really time consuming and expensive to build on site. So if you just have to assemble them within a house, that makes it a lot cheaper…everything else can be done offshore. 'Another thing to look at would be the way we design houses. One of the reasons why it's so expensive to build is because Australians really love their houses to be different from their neighbours. 'And so, if we're looking at new areas, if we're starting to build houses that are very similar, then it becomes a lot quicker and cheaper to build houses.'
Mercury
31-05-2025
- Business
- Mercury
Locked out: Generation faces housing crisis catastrophe
Australia's housing affordability crisis has reached code red status as runaway construction costs threaten to permanently lock out a generation of potential homeowners. A new analysis reveals a construction sector in turmoil, with renovation expenses surging a staggering 43 per cent since late 2019 and building material prices remaining stubbornly elevated, sitting 35.4 per cent above pre-pandemic levels. The crisis, driven by a perfect storm of crippling labour shortages, supply chain disruptions, and soaring prices for essential materials is prompting urgent calls for government intervention to prevent a full-blown housing catastrophe. Exclusive data by the Housing Industry Association shows essential materials are bleeding budgets dry, with the cost of copper pipes and fittings skyrocketing by 14.4 per cent annually and 63.4 per cent since the end of 2019. The cost of electrical cable and conduit are equally alarming, jumping 9.5 per cent annually and a shocking 69.7 per cent since the end of 2019. Even the humble clay brick, a cornerstone of Australian construction, has surged by 8.3 per cent annually and 48.4 per cent since the end of 2019, while timber doors rose by 7.4 per cent annually. RELATED 17,000 ads: Aussie tradie jobs no one wants Demolition dilemmas: Aus homes under threat Build new for less: Top spots under $850K revealed Only materials like plywood, steel beams, plastic sanitary ware, reinforcing steel, sheet metal and other electrical equipment saw a reduction in cost between 4 per cent and 9 per cent. However, it's a drop in the ocean, considering the cost of skilled labour, which saw a 5.5 per cent increase over the 12 months to March, with those looking to build now paying 35.5 per cent more for a home than they did pre Covid. To put it in numbers, the average national build cost now is $484,315, according to March figures by the Bureau of Statistics, $18,832 more than the previous year and $152,969 more since pre-Covid in 2020, when the average build cost just $331,346. HIA senior economist Tom Devitt said while the numbers looked bleak, the cost of construction material was starting to stabilise. 'Some of the numbers shared do show a few materials are still going up really rapidly…but the average building materials have actually really slowed. They are still very much elevated from five years ago but they do look like they've stabilised. 'Labor costs are also still increasing quite rapidly but also not as much as they did three years ago. Our trade report two or three years ago had a single year where trade prices went up 10 per cent.' Mr Devitt said while the cost of materials would come down with time, the real concern going forward was ongoing labour shortages. 'The demand is still going to be outstripping the supply of trades unless the government follows through on what they've been paying lip service to in terms of fast tracking in-demand construction trades,' he said. '(So far) nothing has really progressed from that because the number of skilled trades that have been arriving, relative to overall overseas arrivals, has been minute.' The hidden cost behind Australia's homebuilding struggles An analysis by NextMinute, a leading project management software for tradies, recently shed light on the occupations with the highest vacancy rates and the most job ad listings across Australia, revealing a stark disparity between supply and demand in the trade sector. Official figures indicate that motor mechanics, electricians, and welders are among the most sought-after trades, with thousands of vacancies across all Australian states. However, SEEK job ad volumes suggest the demand is far greater, with listings for electricians alone exceeding six times the official vacancy count. Similarly, there are 9749 listings for mechanics and 2706 for welders, reflecting widespread recruitment challenges in the industry. Despite attractive salaries, several trades remain under-represented in global job searches, such as airconditioning and refrigeration mechanics, who earn over $2000 per week. The United Kingdom leads overseas demand, with UK-based workers conducting thousands of monthly searches for Australian trade jobs. NextMinute CEO Alex Jenks said the discrepancy highlighted the ongoing recruitment challenges faced by trade businesses. These shortages are slowing down projects, driving up costs, and putting pressure on business owners,' he said. 'Interestingly, the countries showing the most interest don't always align with the trades in greatest need. 'For example, airconditioning and refrigeration mechanics have over 500 official vacancies, but little international search activity, pointing to blind spots in global awareness of Australia's workforce needs.' Australia needs to think modular With Australia forecast to fall 262,000 homes short of its national 1.2 million housing target by 2029, Ray White Group senior economist Nerida Conisbee said a modular approach was needed to address ongoing construction concerns. 'It's taking things like trusses off site and making it more of a manufacturing process, as opposed to building them on site where you need far more skilled labour,' she said. 'Another example would be kitchens and bathrooms which are really time consuming and expensive to build on site. So if you just have to assemble them within a house, that makes it a lot cheaper…everything else can be done offshore. 'Another thing to look at would be the way we design houses. One of the reasons why it's so expensive to build is because Australians really love their houses to be different from their neighbours. 'And so, if we're looking at new areas, if we're starting to build houses that are very similar, then it becomes a lot quicker and cheaper to build houses.'
Sydney Morning Herald
13-05-2025
- Business
- Sydney Morning Herald
How the cost of building a new house just hit a record high
He also warned that the construction workforce is not large enough to build enough homes to meet the federal government's target of 1.2 million new homes in five years, and the ongoing infrastructure projects such as roads, schools and hospitals. Not enough new workers were joining the industry, he said, especially as experienced workers retire or semi-retire. 'When you don't have enough workers, what happens? Workers go to the highest bidder and that means if you're going to go ahead with your project, you're going to be paying much higher wages.' He said the cost of materials was generally much higher than six years ago, especially for timber, ceramic goods and electrical equipment. But he thought it unlikely labour costs would decline, especially as some of the larger unions negotiate increases in wages from year to year. Loading Housing Industry Association senior economist Tom Devitt said the recent rise was largely due to labour cost increases, while the unemployment rate holds at historic lows. 'The shortage of skilled trades for construction sectors is particularly acute,' he said, calling for a boost to domestic workforce capabilities as well as skilled migration. He noted changes to the National Construction Code to improve energy efficiency, which he thought was a worthwhile objective, but said it resulted in costs that were passed on to home buyers. He added that the figures on the cost of building did not include the rising cost of land. Despite the national target of 1.2 million new homes in five years, Devitt forecasts that the nation will struggle to deliver a million in that time frame. 'It doesn't bode well for affordability, especially for home buyers.' Sydney builder Robert Faraj, director of Pioneer Building Group, has been dealing with the impact of rising materials costs on his projects. For example, he made an order of plasterboard in mid-February. It was delivered on March 2, but on March 1 the supplier increased prices by 7 per cent, leaving him paying the March price. That meant it cost $40,000 for enough plasterboard for four, four-bedroom houses. The product usually increases in price four times a year. Electrical cable for light switches has increased, too, among others. 'It didn't jump $95 or $100 in a week. Every second month [the suppliers say] 'Oh hey, 10 per cent, 10 per cent, 10 per cent,'' he said. But to maintain his reputation and the quality of his work, he does not want to look for the cheapest quote. He focuses on high-end, bespoke, luxury-built homes as well as commercial construction. 'You're judged on your worst job, not your best job, so we're always trying to maintain a standard and a value of what we give our clients,' he said. He also can't charge clients more once they have agreed on a price for a build. 'How? They can't go back to the bank and say, 'hey bank, Robert said the plasterboard has gone up.'' As a result, he does not see quite as much work available as previously. 'Everyone's saying it's not worth it, so we're not seeing as much come through the pipeline of approvals of work,' he said. 'We've got some really good tradies in this country and most of them are busy at the moment doing all these tunnels.'
