The current low rate of building in the Australian property sector could prevent it from being overly affected by the Chinese economic slowdown and its concurrent slump in demand, analysts have claimed.
New Australian Bureau of Statistics figures recently showed that home building had declined for the fourth quarter in a row - but despite the gloom this has caused among property professionals, it is possible this could reflect levels of demand rather than lead to a crisis.
Citigroup strategist Tony Brennan said in a recent report seen by Property Observer that this could reflect a correction in a market responding to a major period of building.
An excess of supply is likely to put downward pressure on values, he added.
HIA senior economist Andrew Harvey claimed that the slump in residential building activity could have "real consequences for jobs, small businesses, the supply of new housing and rental costs".
Posted by Craig Francis
