House building activity falls again in October

Building activity dropped for the 29th consecutive month in October, new figures have shown.

The latest Australian Industry Group/Housing Industry Association Australian Performance of Construction Index (PCI) stood at 35.8 last month, with ratings under 50 said to represent contraction in the sector.

Though this is obviously disappointing for people who are hoping to secure a mortgage in the near future, Australian Industry Group director of public policy Dr Peter Burn said the rate of decline has slowed down.

"While the construction industry and particularly the commercial and residential construction sub-sectors are still contracting, the Australian PCI took a turn for the better in October," he remarked, before adding that the house building sector still has a lot of recovering to do.

Last week, Master Builders Australia also warned the outlook for the property market "remains fragile", despite the recent interest rate cuts sanctioned by the Reserve Bank of Australia.

The central bank's decision not to lower rates further this month could put paid to any hopes of an imminent upturn.

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