Multi-unit residential construction activity was the one bright spot in an otherwise subdued outlook for overall residential building in 2011/12, with activity unlikely to meet demand, BIS Shrapnel said today. This is in sharp contrast to commercial and industrial building activity, which was expected to surge in the same period, BIS Shrapnel said in its Building in Australia 2011 report.

“The continuing recovery in commercial and industrial building – up 21 per cent – will be a key driver of the improvement in building commencements in 2011/12, while increased construction in the health sector – up 73 per cent – will also play a part”, said BIS Shrapnel managing director, Robert Mellor.

Mellor said residential building is forecast to remain flat in 2011/12 after being negative in 2010/11, following the expiry of the First Home Owner’s Grant Boost Scheme, as well as the winding down of the Federal Government public housing stimulus.

 “The decline will more than offset an otherwise healthy rise in multi-unit residential starts” the company said. 

“That rise is largely due to the improved financial environment which allows developers to be increasingly able to fun apartment projects”.