Govt infrastructure spending fuelling construction industry
Construction tender prices are expected to experience year-on-year increases in every capital city during 2024, according to the latest forecasts from property group RLB.
Adelaide (6.5% growth) and Brisbane (6.0%) are likely to have the strongest price growth, followed by Melbourne, Perth (both 5.0%), Sydney, Darwin (both 4.5%) and Canberra (4.0%).
Still, that’s a slowdown from 2023, where capital city price growth ranged from 4.5% to 8.0%, and 2022, where it ranged from 5.0% to 12.5%.
“While continuing its contribution of approximately 10% of Australia’s GDP, the construction industry grapples with persistent influences of high escalation, industry solvency, low productivity, and labour shortages. However, the outlook for the construction industry is positive,” RLB director Domenic Schiafone said.
“Governments across all levels in Australia are prioritising infrastructure spending. This includes projects related to roads, rail, utilities, renewable energy and social infrastructure like schools, hospitals, and recreational facilities. This commitment to infrastructure development is expected to continue to inject significant funds into the industry, creating a steady stream of projects for construction companies.”