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Construction Trends 2008
Today’s NSW construction market activities are changing. The global market economics, amongst other things, are altering the economics of the property market, namely: -
- People are now renovating their property rather that up or down sizing. The hefty cost of government exit and entry fees when purchasing a property is now being measured against alterations and additions;
- New developments or alterations and additions are required to demonstrate the use of green technology through BASIX legislation. Use of rainwater harvesting, alternative energy source and change to building form are common;
- Raw materials are in high demand in developing countries such as India and China. This is pushing up the cost of raw materials and making some materials hard to source. It took the western world over 100 years to have an industrial revolution, China is doing it in 10 / 15 years. An example of the cost pressures is the base price of structural steel; it has increased 3 times already in 2008 and will likely increase a further 20% in June 2008;
- Petrol price volatility affects all aspects of business. The increased price of fuel means contractors are making provisions within their quotations for price future increases;
- Lack of skilled resources, particularly trade based, are impacting on the cost and production of certain building types. Lots of trades are heading to the high wages in the mining industry, and the ongoing scarcity is driving up prices.
- Councils are changing the Development Application legislation process. This change is intended to accelerate the pre construction administrative process and decrease the bureaucracy required. It is intended to greatly assist with alterations and additions applications.
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