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Apartment building running at double historical trend

A record-breaking recovery in homebuilding is under way and will continue tilting the Australian lifestyle towards apartment living, according to an economic forecaster.

BIS Shrapnel’s Building in Australia 2014-2029 report stated dwelling building activity will reach a new high in terms of homes constructed, and more of those new homes will continue to be in apartment towers.

New housing starts are forecast to reach 190,000 in 2014/2015, which will surpass the previous peak of around 187,000 set back in the 1994 boom.

In the next two years we’ll also see the recent emphasis on high-rise units continue.

Currently, two high-rise apartments are being built for every five detached houses, which is double the historical rate of one apartment for every five houses built.

BIS found that a combination of strong population growth and low interest rates is generating a record-breaking homebuilding outlook for 2014/2015 that will continue into 2015/2016.

Homebuilding has been punching below its weight for about a decade, and has not kept pace with population growth for some time now.

The Building in Australia report estimated that there is a national dwelling stock deficiency of about 100,000 dwellings.

It is estimated that it will take the next five years to eliminate the unmet demand for housing. It doesn't appear this housing shortfall will close until at least 2018.