The need for a further cut from the Reserve Bank of Australia (RBA) and government reform of the Australian property development system has been underlined by the poor number of housing starts recorded in South Australia (SA) over the last quarter, according to the Housing Industry Association (HIA).
Seasonally adjusted dwelling commencements fell by 15.4 per cent over the December 2011 quarter, putting them down by 19.5 per cent on a year-on-year basis.
HIA SA executive director Robert Harding said the figures imply that SA has built 2,330 less homes than it did in 2010, indicating a worrying lack of activity across the market.
"The SA government should not rely on interest rates, but double their efforts to reform housing processes to reduce the costs of new housing," explained Mr Harding.
This is an attitude shared by many of the HIA's analysts, with senior economist Andrew Harvey recently arguing the government needs to formulate a coherent policy on housing.
Posted by Steve Douglas
