HIA Housing Update

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It continues to be a busy year for the residential building industry as we deal with changing economic conditions and more new legislation and regulations from the Government.

Housing Outlook

Even though new home builds have been at record high levels for the past five years, HIA expects housing starts to moderate, and be more in line with long term averages over the next few years.

HIA’s Outlook data shows that even in recent times with multi-unit housing starts correcting downwards by a third in 2018/19, total housing starts for the financial year were still the fifth highest on record for Victoria at 62,190.

Detached home starts especially, were only down by an estimated 3.7 per cent for 2018/19 at 37,210 – which still represents the second highest financial year of this cycle and third highest on record.

Even as the volume of housing starts cools in the coming years, housing starts for Victoria are expected to remain around 50,000, with detached dwellings accounting for the majority. In 2020/21 HIA forecasts 49,050 starts for Victoria, including 30,010 detached dwellings. This would represent more of a long term average.

We also know that there is a big pipeline of infrastructure projects currently being worked through across the State – over $50 billion worth in the next four years which will help support economic activity.

Victoria also has the advantage of having maintained its strong population growth rates. People still want to move to Victoria and population growth has consequently outpaced the nation since 2011. This will continue to support demand for housing and broader economic activity in the State.

Registration of Trades

In September 2018 the State Government passed legislation to require the registration of subcontractors and licensing of employees who carry out building work in Victoria. This is set to start in September 2020, with a staggered start and phase in time over several years. The regulations for this new requirement are now being developed by the Government so we should have more details soon.

Whilst debating the matter in Parliament last year it was suggested that carpenters, bricklayers, water-proofers, plasterers and footings and slab workers will be subject to the new requirements – the regulations are just being drafted and will need to confirm this.

This is significant as both subcontractors and employees will not be able to undertake building work directly for a builder without being registered in the case of the subcontractor and licenced in the case of an employee. HIA continues to present member views to the Government on the likely upskilling requirements, higher business costs associated with the registration and licensing of subcontractors, and the expected loss of trades to the industry. Regulations are still to be made, so much is still to be determined around this new requirement.

Safety Update

The Government has launched a new health and safety enforcement campaign that will see WorkSafe with more inspectors coming around to more construction sites to ensure that builders and contractors are meeting their requirements.

The Government will also follow through on a pre-election commitment to make workplace manslaughter a criminal offence. HIA understands that legislation is currently being developed and has expressed member concerns with the proposal, noting that the current safety laws respond appropriately to fatalities at a workplace. Also the proposed offence should not be made in the way currently proposed.

New silica regulations have also just been made. The regulations ban uncontrolled cutting, grinding and polishing of engineered stone. Builders will also need to ensure that their own employees and workers they engage on their sites have the correct tools and procedures in place and have suitable respiratory protective equipment.

If you require further assistance on any of these matters HIA members can contact HIA workplace services on 1300 650 620.

Fiona Nield
Executive Director – Victoria, HIA

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