The national economy rebounded in the December 2016 quarter, and the Victorian economy continued to strengthen.

Population in Victoria reached its highest recorded annual growth, with over 123,100 people added to the population in the year to June 2016 – a higher level of growth than any other state. By comparison, New South Wales grew by 105,590 people over the same period.

Full time employment grew in Victoria and NSW, but declined across all other states. The total number of full-time and part-time jobs for Victoria recorded 3.09 million as at the end of December 2016, representing a gain of around 1.2 percent over the last quarter of 2016.

The national economy experienced a strong recovery on the back of the country’s first quarterly negative growth in the September quarter since the global financial crisis, with the GDP expanding by 1.1 percent in the December 2016 quarter. Despite this growth, the National Consumer Confidence Index dipped at the end of December.

Residential construction activity

Housing affordability worsened over the December 2016 quarter, and the rise has caused the average loan amount for purchasers to increase.

Residential construction work completed in Victoria recorded $6.52 billion in the September quarter, representing a quarterly decline of 6.5 per cent, but a growth of 5.7 per cent on the same quarter of the previous year.

Approvals of new detached dwellings mandating its steady pace, and multi units approvals jumped significantly over the last quarter of 2016 before dropping slightly at the beginning of 2017. In terms of starts, the lower levels of new house approvals in the second half of 2016 are likely to have caused new starts to move away from the peak experienced mid 2016.

Total housing finance lending reached around $44.4 billion nationally in December 2016, growing by 3.3 per cent compared to September 2016, although owner-occupied finance across the country levelled off since the turn of 2016, albeit maintaining a high level.

Non-residential construction activity

The value of non-residential work done for Victoria for the September quarter declined, recording around $9 billion, down from around $9.3 billion in the previous quarter, however there was around eight months of work in the pipeline, up from around six months at the end of June 2016.

Engineering construction

Engineering construction for the whole of Australia further declined in the December quarter of 2016, dropping by 2.2 per cent on a quarterly basis, and 18.6 per cent year-on-year in seasonally adjusted terms.

For Victoria engineering construction activities remained healthy – achieving a year on year growth of 10.9 per cent. This is due to investment in large scale infrastructure projects such as the level- crossings removal, Tullamarine Freeway widening project and the Melbourne Metro Rail link.

Read the entire report here.