High-spending homeowners in Melbourne’s wealthy inner east and the Mornington Peninsula helped fuel the nearly $280 million lockdown construction boom in Victoria.
Families in Point Nepean, Albert Park, and Malvern-Glen Iris are the largest consumers in the state. In the 11 months to May, homeowners spent between US$46.3 million and US$61.8 million on home upgrades.
According to data from the Australian Bureau of Statistics analyzed by Ray White economist Nerida Conisbee, the state approved $279.4 million in house renovation and alteration projects in May, with an average of $106,916 per project.
In the year to May, 29,700 jobs were approved, and about 2,600 jobs were cancelled in May alone.
Despite entering the fourth Covid-19 lockdown period on May 27, the state is still the best performing state in the United States in terms of overall approvals.
Nerida Conisbee, chief economist at Ray White, said the Victorian lockdown led to a 20% increase in the number of DIY and home improvement jobs by businessmen across the state last year.
She said that for those who find themselves trapped inside and want to maximize space or comfort without the pressure of moving, refurbishment is a viable option.
“People are trapped at home, they watch everything more closely; they want more space, they have spare money,” Ms. Cornishby said.
“Compared with buying a new house, adding a new kitchen or bathroom is much more cost-effective.
“Even a fairly small renovation can significantly improve the livability of a house, and it is difficult to overinvest because the price has soared so much.”
Last year, more than 116,000 housing renovation and addition projects were signed nationwide, the highest record in 12 months.
According to ABS data, the total value of projects approved nationwide in May was close to $1b.
The data came as the Victorian State Builders Association confirmed on Monday that a positive case of Covid-19 had been detected in the state’s construction industry.
Later last week, after an infected consultant engineer visited the company’s three CBD workplaces, a Multiplex site was under outbreak management by the Ministry of Health.
Employees of the West Gate Tunnel project remained vigilant after a V/line worker visited the site on Thursday and subsequently tested positive.
After an active naval officer returned a positive test result, several Lendlease workplaces in HMAS Cerberus were also declared exposed.
MBV CEO Rebecca Casson stated that there is almost no risk of cross-contamination at the Multiplex and West Gate project sites. Once contact tracing is completed, the Lendlease site is expected to be cleaned up and resumed work later today.
Sign up for the Herald Sun for weekly real estate updates.Click on Here Send the latest Victorian real estate market news directly to your inbox.