Strong renovation market keeping Cairns builders busy during construction downturn
A slowdown in new housing construction in Tropical North Queensland is being counter-balanced by increased demand for home renovations.
Tropic Now has obtained figures from the Queensland Building and Construction Commission (QBCC), which show the value of home renovations in Cairns in the past 12 months has exceeded the $100 million mark.
The QBCC governs policies under the Queensland Home Warranty Scheme, which need to be taken out if residential building work is valued over $3,300.
Its figures show that between April 2018 and April 2019, there were 3,491 such policies taken out for renovation work totaling $100.4 million.
In the same period for the previous year, there were 3,100 policies worth $92.2 million.
Builder Piet Baxter from Modern Rustic told Tropic Now the numbers certainly reflect his reality.
“There’s definitely been an increase in home renovations in the past year or so,” he said.
“That happens every cycle, so in a growth market you’ll see new homes and in a downward market you’ll see renovations on the rise.
“That’s due to consumer confidence and financing.”
Mr Baxter said a tightening of lending following the Banking Royal Commission hasn’t impacted prospective renovators in the same way new home buyers have been affected.
“Depending on the size of the reno they either have the cash there or they’re getting financing for smaller amounts and they’re using the equity in their house,” he said.
The QBCC figures also show that last financial year, renovations accounted for 72.42% of all residential construction work in Cairns, compared with 27.58% for new home construction.
In comparison, new homes accounted for 33% of all residential construction work in 2016/17, while 67% was for renovations.