SCRAPPING of homebuyer grants and a lack of major projects is being blamed for a building slump in the south-west.
Figures from Warrnambool City Council show the number of new permits last year nearly halved, compared with 2012.
Two other south-west councils — Corangamite and Moyne — have also experienced a drop.
Warrnambool City Council director of city growth Bill Millard told The Standard the country’s economic mood had led to apprehension by new homebuyers.
“There’s definitely fewer permits,” he said.
“The trend has been lower in 2013. I think there’s a general acceptance that the economy is facing challenges and this may well include new homes.
“The indication to me is that people may be upgrading their existing house rather than building new ones.
Just 136 permits were issued by the council last year, compared with 205 in 2012.
The value of works has also dropped from $61,238,437.00 to $38,319,473.87.
Corangamite Shire issued just 25 building permits for dwellings in 2013, compared with 44 the previous year, while there was only a modest drop in Moyne Shire.
“Council’s role is making sure the process runs as efficiently as possible,” Mr Millard said.
Rodger Constructions development manager Sam Stevens said land sales were quiet, but voiced hope of a turnaround.
“We predominantly work in land sales so we get a fair reflection of what’s going on. It’s been a fairly quiet year and we felt there was a lot of reluctance from people to buy too early until the titles had come through,” Mr Stevens said.
“We’re getting some inquiries come through now and things are picking up.”
Port Fairy’s Hearn Constructions avoided the storm by working in different parts of the market, including beach homes and renovations.
“We’re busy all the time, it’s been really solid,” owner Michael Hearn said.
But he said the removal of federal grants and stalled commercial projects in Warrnambool such as the next stage of the base hospital redevelopment — a new accident and emergency and operating theatre section — was having an effect on the bottom line of local companies.
“That’s taken a huge chunk out of the market for builders in that area.”
Construction, Forestry and Mining and Energy Union (CFMEU) organiser Peter Booth said south-west construction workers had left the district in pursuit of jobs elsewhere.
“Most construction workers have left because there’s not enough around Warrnambool. Many have gone interstate,” the union leader told The Standard.
“In Warrnambool in the last 12 months there’s only been three major projects started. They’ve finished off work at Deakin University, a funeral parlour and a show room.”
Mr Booth said the sector was waiting for work to begin on the South West Integrated Cancer Care Centre and several wind farms near Port Fairy.