DAVY VIEW

Despite an improvement on H1 2024, this morning’s update for housing completions in Q3 marks an inopportune pre-election result for the government. Output over the past four quarters remains below 32k, all but ruling out the coalition’s hoped-for output of 40k units this year. While we expect a strong housing result in Q4, it is also clear that our forecast of 36k units this year is somewhat too high. However, 49k housing commencements in the past 12 months suggest a material increase in housing output will take place in 2025. To address pent-up demand, expected new household formation and account for obsolescence, we estimate a need for 85k new units each year until 2030.