380% timber price surge cuts down ‘wood-be’ homeowners
- Timber prices soared 380% to record highs this year as domestic suppliers contend with surging global demand.
- Domestic timber supplies waver following 8.5 million hectares of forest burned in the 2019/20 bushfires.
- $1.6 billion in residential construction remains on hold as 9,800 households await the completion of their dream home.
Australian builders have been left without their most critical material as a global construction boom sends timber prices into orbit, up 380% to the record high in May this year.
Domestic supplies of timber have also hit a wall following the 2019/20 bushfires in New South Wales and Victoria, which destroyed 8.5 million hectares of forest, taking decades to replace according to the Australian Department of Agriculture, Water and the Environment.
On the receiving end of critical supply shortages are construction businesses forced to wait on $1.6 billion of residential construction activity stimulated by the Federal Government’s HomeBuilder grants.
Of the 99,000 families who applied for the grant to build their dream home, 9,800 (10%) have been left in limbo, likely forced to resign their lease without knowing when construction will conclude.
The graph which shows the difference between residential projects commenced and completed quarterly, highlights the diminishing capacity of construction businesses during the latest boom.
Wait times are likely to continue with construction activity still being spurred on by record low interest rates and a raft of federal and state incentives aimed at bolstering the sector in the last 18 months.
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