Business confidence in Queensland's building and construction sector is on the rise, according to an industry survey. Master Builders' survey of industry conditions for the June quarter has found an "upswing" in business mood. Master Builders deputy executive director Paul Bidwell said the survey was a helpful gauge for "specific industry expectations" right across Queensland. "These results reflect a period of stability in Queensland, following the state election and the scaling back of mining investment," he said. "Optimism has been boosted by an improved unemployment rate and continued low interest rates. "The good news for the construction sector is that, relative to the wider economy, it is expected to perform strongly. "And within the industry there are a significant number (37 per cent) that expect the industry to improve further." Labour costs were identified as the number one constraint to growth. "While the labour market has been flexible enough to respond to the increase in demand until now, it appears to be reaching the limits of that flexibility," the report found. The report also found the outlook for housing affordability had "deteriorated slightly" over the June quarter. Just 27 per cent thought the situation would improve, with 23 per cent thinking it would worsen. The remaining 50 per cent thought it would remain the same. "While interest rates remain low and building costs are competitive, the ability to invest has declined due to stagnating wages and a tightening of finance terms by banks, especially for investors," the report found. "New housing continues to be beyond the reach of many, with more than 67 per cent of respondents identifying affordability as having a negative impact on new housing demand." The report found south-east Queensland, particularly the Gold and Sunshine coasts, continued to be the "driver of growth".
"Central Queensland has had a strong quarter as a result of the Cyclone Marcia repair work," the report found. "The challenge now will be to turn this kick-start into ongoing momentum. "While Mackay and Whitsunday continues to struggle, some optimism is beginning to return and this is expected to continue. "Each of the remaining regions returned an improved performance on the previous quarter but continue to struggle with less than positive results."
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Source : www.brisbanetimes.com.au