Australian Property News
Construction shows signs of a recovery
Posted on Thursday, February 04 2010 at 8:27 AM
While the Australian construction industry was hit by the global financial crisis (GFC) last year, things are looking up this year.
Last year commercial tender prices were measured at a negative 3.4 per cent nationally, according to David Langdon, but the company is predicting a modest increase in prices during 2010 of around two per cent.
David Langdon's national research manager Rachel Kelloway says the industry has started off slowly this year and most of the increase is likely to occur in the latter half of the year.
"Nationally the construction sector is still highly competitive and there is nothing to indicate that the sector's competitiveness is going to drop off any time soon," she says.
"Towards the second half of this year we expect it starting to bite again and consequently we are likely to see an increase in tender prices."
"However, across 2010, this is expected to be only of the order of two per cent, and with an expected 3.2 per cent increase in underlying inflation, the sector still has a long way to go."
Opportunities for major commercial projects remain weak at a national level due to a combination of the GFC, availability of finance and weak tenant demand.
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