Australian Construction Industry

The Current State Of The Australian Construction Industry What's Happening O Construction Industry At The Lowest Level in 2 Years In contrast. 46.1 IRE 56.4 Performance of Construction Index (PCI) 55 Increasing 61.8 GER 50 45 Decreasing 40 37.9 11 months of decline for the PCI Index. 35 30 25 A MJJA SONDJFMAM JJASONDJFM A 2009 2010 2011 2 The Apartment Construction Still Declining Increasing Activity by Sector PCI Sub-Index Houses PCI 60 Apartments Commercial Engineering 50 40 30 20 Decreasng APR APR 09 APR 10 11 APR 09 APR 10 APR APR APR APR 09 10 APR 09 APR APA 10 11 11 11 16 13 13,130 Dwelling units approved 3 Building Approvals Are Going Down 10 8,016 Private sector houses approved D MJS D M 2009 2010 2011 4 Value Of Building Work Done Across The Country -15.2% NT -7.5% OLD $220m -4.5% Australia Average WA $4.583m -2.2% -4.6% $3.127m $1,354m -4.6% $5,062m NSW $21,363m 1,8% VIC $5.998m -10.5% 5 Builders Are Becoming Increasingly Concerned -3.9% ACT TAS $369m $649m Builders Business Activity Is Closely Related To The Performance of The All Ords On The ASX. Where Builders See Their Business Activity & Profits Heading Index Where's your 70 business acti- Good 60 vity heading? Where are your profits heading? Poor 40 30. MAR 2007 MAR 2008 MAR 2009 MAR 2010 MAR 2011 Can you see how this graph here follows the same trend? All Ords 2007 2008 2009 2010 2011 Why It's Happening Australian Homes Investor sentiment Are Currently Overpriced vulnerable to The Market Will Not Be delays in rental market adjustment Moving For A Few Years S Thousands $ 559,000 600 Incomes growth FIRB relaxed Rental market 550 tightens; rentals grow 500 Interest rates fall Interest rate rises Average house price 450 FIRB tightened, FHOB removed 400 Currency strength 350 300 2007 2008 2009 2010 2011 2012 2013 2014 2015 Sources: Infographic by: PCI Australian Report, April 2011 Australlan Bureau of Statistics: Building Approvals Australia March 2011; Building Activity Australia December 2010 Master Builders Australia GRANT ELEVATORS Yahoo Finance, AODR National Housing Supply Council, Report 2010, Australian Government ANZ Economics & Global Markets Research, Housing Overvaluationi GrantElevators.com.au -----.