More people and new homes have helped Victoria edge past NSW as the nation’s top performing economy, a new report shows.
CommSec’s quarterly State of the States economic report, released Monday, has for the first time named Victoria the nation’s best economy since the rankings began in 2009.
Strong population growth, which has driven broad construction activity including new homes, has helped Victoria pip NSW.
Victoria added almost 400 people a day in 2017, taking its population up 2.3 per cent – the highest growth rate in the nation.
“While NSW has the strongest job market in the nation and is showing good economic growth, a number of housing indicators softened this quarter, including home loans and spending on new plant and equipment,” CommSec chief economist Craig James said on Monday.
Trend housing finance, which can be a helpful indicator of activity in the financial sector, has dropped in the past 12 months in all but two states and territories.
Only Tasmania (1.3 per cent) and Victoria (0.6 per cent) are showing annual growth in home loans.
The CommSec ranking takes in eight economic indicators and assesses the states against their long-term average.
Best for economic growth and two construction indicators while Victorian retailers were narrowly bested by NSW’s.
Slower growth in equipment investment and some housing indicators contribute to its slip from top spot.
The capital tops the nation for relative housing finance and equipment spending.
The Apple Isle benefited from firmer home buying and building activity and topped the nation for growth in four measures.
Edged past SA on the back of stronger population growth.
6. SOUTH AUSTRALIA
The unemployment trend is the lowest since 2012 while equipment growth is the country’s worst.
7. NORTHERN TERRITORY
Strong construction and economic growth numbers couldn’t budge NT from seventh with weak retail and job figures hurting.
8. WESTERN AUSTRALIA
While equipment spending and population growth hasn’t been higher in the past two years, the weak job market and lagging retail spending has helped cement it to bottom place.