Building Industry Outlook: 2024 Predictions

What You Need to Know

Welcome to the new year! We hope your festive season was enjoyable.

Following a challenging 2023, we remain optimistic about the improvement of industry conditions as the year progresses. While the long-term prospects for the home building industry are positive, it will be a difficult start to the year. Consumer demand remains low, and the pace of new home building continues to slow.

The economy

Victoria’s growing population highlights the need for more homes, but government expectations for increased construction are unlikely to be met this year. Sales of new homes will not improve until there is greater certainty about interest rates. Many projects will also be delayed until cost increases and shortages of skilled workers ease. This means that the pipeline of home-building work will shrink this year.

The Victorian government has started to reform the planning system and this will result in more planning approvals. However, planning approval is not enough to get building work started and completed. The government must also reform the regulation of the building industry and reconsider its current punitive approach to property taxation.

“The Victorian government has started to reform the planning system and this will result in more planning approvals.”

National Construction Code

After a delay, the NCC 2022 changes to the accessibility, condensation mitigation and energy efficiency of homes are scheduled to commence on 1 May 2024.

HIA has already done a lot to help the industry prepare for these changes and will continue to do so this year. Our members can obtain detailed information about these changes from the HIA website, including information sheets about the NCC. They can also call our Building Service Advisors and Workplace Advisors for more assistance.

“After a delay, the NCC 2022 changes to the accessibility, condensation mitigation and energy efficiency of homes are scheduled to commence on 1 May 2024.”

New Victorian Laws

At the start of last year, I said that we expected to finally get more details about the registration and licensing of trades and regulations for registered builders to undertake continuing professional development (CPD). This did not happen, but it is expected that the government will release proposed regulations for these reforms in the first half of this year.

The Victorian government has also proposed to make it an offence to collect a deposit for a home building contract without first obtaining domestic building insurance for the job. This legislation is currently before Parliament and the new offence will probably be enforceable by the middle of the year.

“The Victorian government has also proposed to make it an offence to collect a deposit for a home building contract without first obtaining domestic building insurance for the job.”

There are also reviews of the Building Act and the Domestic Building Contracts Act now out for public comment. These reviews are likely to result in more legislation changes being proposed by the government, though these may not take effect until next year. It is also possible that there will be changes to the domestic building insurance (DBI) system. The Building System review has pointed out that more Victorian homeowners do not have access to DBI as they have bought high-rise apartments. It is unlikely that this can continue.

HIA will continue to provide information and support for its members about these matters and future columns in this magazine will also provide more detail.