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HomeBuilder stimulating demand but impact on work still wanting

Adrian Flores
Adrian Flores
20 August 2020 1 minute readShare

Small residential builders are seeing an increase in demand since the government’s HomeBuilder stimulus package, even though it is yet to impact actual work, according to new data.

A report from small builder software Buildxact for the June quarter found that the COVID-19 pandemic has not adversely affected the businesses of small builders.

It revealed strong demand for renovations and custom-built homes in the June quarter, with the federal government’s $25,000 HomeBuilder grant helping boost the number of quotes, with quotes up by 11 per cent between June and July.

The data revealed that the volume of quotes in June 2020 was up by 28 per cent compared with the volume of quotes in March, and total quote values in June rose by 29 per cent compared with March.

According to Buildxact, the second COVID-19 lockdown in Victoria is expected to have a minimal impact on small builders because the size and nature of the projects on which they work require fewer than five people on site.

The strong demand for renovations and custom-built homes continued over July 2020, with the total value of all work quoted growing to $1.62 billion. In February 2020, the value of all work quoted was $1.1 billion.

“So, over the course of COVID-19, we’ve gone from $1.1 billion to $1.62 billion — massive growth,” said Buildxact chief executive David Murray.

“We’ve not had that level of growth in the period previously.”

However, Mr Murray said he expected a significant impact on the work being quoted and won by Buildxact’s builder customers when the COVID-19 crisis began, but that has not happened.

He said one possible reason is that people are spending more time at home and thinking more about undertaking renovations or knockdown rebuilds.

“Builders are telling me that they were very busy beforehand, and now they are quoting on projects with the government grant, but they haven’t necessarily started those projects yet,” Mr Murray said.

HomeBuilder stimulating demand but impact on work still wanting
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Adrian Flores
Adrian Flores

Adrian Flores is the deputy editor of MyBusiness. Before that, he was the deputy editor for SMSF Adviser as well as features editor for ifa (Independent Financial Adviser), InvestorDaily, Risk Adviser, Fintech Business and Adviser Innovation.

You can email Adrian at [email protected].

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