Victoria tops the hotspot list

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Nine of the report’s top 20 national hotspots were found in the Garden State, with Queensland holding five, Western Australia four and New South Wales two.

Looking at figures from the 2009/10 financial year, the report defines a ‘hotspot’ as a statistical local area (SLA) where population growth exceeded the national rate and the value of approved residential building work was more than $100m.

“Victoria, in particular, has benefitted from the temporary boost to population growth in recent years which was driven primarily by historically high net overseas migration,” said HIA Chief Economist Harley Dale.

“Relatively affordable new housing was also a significant contributor to Victoria dominating the top 20 national Hotspot list.”

The Whittlesea North SLA in Victoria topped the list with $663,820 worth of approved residential building and an annual population growth rate of 21.8%.

Second place went to Wyndham South (VIC) with $477,690 worth of approved residential building and an annual population growth rate of 16.2%, followed by Pimpama-Coomera (QLD) with building approvals worth $102,632 and population growth of 14.4%.

“The 2009/10 financial year saw all states and territories turn in a strong performance for residential building activity due to stimulus in the form of record low interest rates and a tripling of the first home owner grant for new dwellings,” said Dale.

“Unfortunately with the evaporation of this stimulus came a swift and decisive slowdown – off the back of the hurried return of mortgage lending rates to above-average levels and slow progress in reducing supply side obstacles.”

Finishing on a positive note, Dale added that the combination of softer housing conditions and lower pressure on trades makes 2011 a good year to contemplate building or renovating.

How important is population growth and building activity in determining a hotspot? Is now a good time to build or renovate? Join the debate at www.yourinvestmentpropertymag.com.au/forum

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