Results from the International Construction Market Survey 2015 indicate that Australian construction conditions have improved due to a falling Australian dollar and the decline of the mining sector.
Conducted by Turner & Townsend, a project services company, the survey compares construction costs across 35 global markets.
Although these two economic conditions may be viewed negatively in some sectors, for the construction industry it’s a good thing according to Gary Emmett, senior economist for Turner & Townsend. A falling Australian dollar, combined with a low interest rate environment, makes finance relatively cheap and offers stability for construction costs.
He added: “Labour availability has improved significantly as a direct result of several mining projects slowing, which is creating opportunities for other industry sectors.”
New York City is the most expensive place to undertake construction activities, with Sydney now at number 10 and three other Australian cities in the top 20: Perth at 16, Melbourne at 19 and Brisbane at number 20.
The lower Australian dollar, compared to 2011 where it was about par with the US dollar, also makes Australia more attractive for foreign companies. “The 2015 report shows that compared to 2011, it would cost overseas investors paying in US dollars 13% less to construct buildings in Australia, which is a significant reduction,” said Emmett.
The economist concluded that it’s “a great time to build” in Australia and said he expected foreign investors to seek more opportunities here “to capitalise on the favourable conditions to build projects.”
More information on the International Construction Market Survey