A leading indicator of performance is revealed by new orders for apartments and it fell for a third month. The sub-index fell to 37 points which is the lowest in two years.
In nearly three years constraction activity pulled down by an apartment sector that registered its weakest performance. The Performance of Construction Index dropped 4.1 points to 46.7 in May, slipping back below the 50-point level separating expansion from contraction. 'There are, nevertheless, some emerging signs of a pick-up in non-mining related engineering construction with a growing pipeline of infrastructure projects.’ said Ai Group head of policy Peter Burn.
It was expected house building activity to stay at a relatively high level in coming months with April but new orders were shrinking fast for the apartment building sector. But new orders contracted at a faster rate of decline and the sub-index of the sector decreased by 12.1 points in May. This has been the lowest reading on new orders since February 2014. However the levels of standalone houses jumped and this brought some good news. Although the new orders for detached houses remained negative, the rise in the sub-index showed that it is close to stabilising.