Metricon tops new home builder lists as housing starts fall

Melbourne-based Metricon Homes has been ranked Australia’s largest builder in 2010-11, according to the Housing Industry Association.

The list, which ranks the nation’s largest 100 residential builders based on the number of homes started each year, revealed that housing starts fell by 13% from 59,509 in 2009-10 to 51,903 in 2010-11.

The largest 100 builders started 40,183 houses, which was down 21%, along with 11,720 units and townhouses, which were up 30%

With 3,060 starts, all detached houses, Metricon Homes came in as Australia’s largest residential builder for the first time.

The WA-based Alcock/Brown-Neaves Group ranked second largest builder with 2,668 starts, and the Perth-based BGC (Australia) third with 2,435 housing starts.

BGC (Australia) had been at the top of the listing in 2009-10 with 4,392 starts.

Despite Metricon’s top spot, it started 5% fewer houses this year than last year, when it ranked third. Its housing starts occurred in Victoria, New South Wales and Queensland. For 35 years, the Mount Waverley-based Metricon has been developing homes that now span the eastern seaboard of Australia from Melbourne to far north Queensland, along with South Australia. Its first office opened in Caulfield, Melbourne by its co-founders, George Kline and Mario Biasin. It now has a team of more than 1,000.

Hickory Developments Pty Ltd was the nation’s largest multi-unit builder for the second consecutive year with 2,003 starts, up on the 1,274 starts for the previous year and thereby improving the company’s overall ranking from number 10 to number five.

The 100 builders in the latest HIA-Colorbond Steel Housing 100 Report held a 33% share of Australia-wide housing starts in 2010-11, down from 36% in 2009-10 and 38% in 2008-09.

The share of the market held by the largest 20 builders was steady in New South Wales when compared with 2009-10, eased slightly in Victoria, and fell substantially in Western Australia. The market share held by the largest 20 builders in Queensland increased moderately. The market share held by the largest 15 builders in South Australia fell significantly.

The biggest mover in 2010-11 was Brookfield Multiplex, with an increase of 846 starts.

The revenue earned from home construction by the Housing 100 was estimated to have eased to $13.6 billion in 2010-11, representing a decline of less than 1%.

The decline in national housing starts in 2010-11 primarily reflected weakness in Queensland, Western Australia, South Australia and New South Wales.

“The unwinding of stimulus measures, heightened interest rate uncertainty, stalled progress in attacking supply-side obstacles, and weak consumer and business confidence amidst negative domestic and global economic news all conspired to derail new home building conditions last financial year,” says HIA chief economist Dr Harley Dale.

“Evidence of accelerated weakness in new housing conditions in 2011-12 reinforces the justification for interest rate cuts and short-term fiscal stimulus to boost Australia’s new housing supply,” Dale says.

“It is also vital to reignite the policy reform process to improve land release, ease persistently tight credit conditions, and reduce the excessive and inequitable taxation burden borne by Australia’s new home building sector.”

This article first appeared on Property Observer.