The infrastructure boom continues to underpin construction activity nationally with major projects underway in New South Wales and Victoria together with other States ramping up investment. The significant investment in road, rail, water, ports, airports and telecommunications, together with population growth and our ageing demographic, is fuelling growth in non-residential sectors such as education, health and aged care.
The multi-residential property market is adjusting in response to the decline in foreign investment, particularly from China where Government imposed capital restrictions are discouraging overseas investment. With the housing boom easing, activity in the multi-residential sector is declining, however construction lags investment and there are still significant numbers of apartment towers to be completed in 2018.
Nationally, the growing demand from the infrastructure sector is pushing up costs of personnel, plant and equipment, and base materials such as aggregates, cement and steel. As resources become more stretched, these pressures create an industry wide challenge. Cost increases in the building sectors are tempered in competitive tender markets with main contractors and sub-contractors adjusting to the declining high rise multi-residential demand, and looking to other market sectors to secure work.