The Queensland Treasurer Curtis Pitt correctly noted yesterday that “The property sector is a real bright spot in the Queensland economy and it’s making a positive contribution to jobs and growth.” This is confirmed by data and casual observation. Regarding the data, for example, the Treasurer pointed to the high level of loans to investors for the construction of new dwellings, at least compared with the last few years (see chart above). Regarding casual observation, wherever you walk in inner city Brisbane you are likely to spot cranes, as I did while walking along the Bicentennial Bikeway on Sunday afternoon (see image below of cranes over West End).
I also remain concerned about the broad economic outlook for the Australian and Queensland economies, particularly given potentially weak levels of business investment over the next twelve months. The drop in commercial finance commitments across Australia reported by the ABS yesterday (see chart below) has reinforced this concern of mine.