Yesterday's Building Activity report from the Australian Bureau of Statistics shows the value of building work and number of dwellings commenced, completed, and in the pipeline are rising.
According to the release, in seasonally adjusted terms:
- The total number of dwelling units commenced rose 11.7% to 47,645 dwellings.
- New private sector house commencements rose 6.3% to 27,923 dwellings.
- New private sector other residential commencements rose 21.8% to 18,161 dwellings.
- The value of total building work done rose 0.5% to $38.9b.
The 11.7% surge in dwelling starts – particularly the 21.8% jump in multi‑residential and 6.3% in houses highlights a construction upswing.
With the total value of building work up 0.5% to A$38.9 billion, momentum is building and potentially accelerating with interest rates stabilising.
Despite a strong March quarter, building activity remains well behind targets set in the Australian Government's Housing Accord.
The target agreed by all parties was to build one million new well‑located homes over 5 years from mid‑2024.
According to Master Builders Australia CEO Denita Wawn, just 134,466 new dwellings have commenced.
To stay on track, 60,000 starts per quarter would be needed moving forward – we are about 25 per cent short of that pace.
So what does this mean for investors?
With new dwelling commencements and building activity on the rise, and pressure for The Australian Government to meet housing targets, here are some ASX materials shares that could potentially be set to benefit from these emerging tailwinds.
Brickworks Ltd (ASX: BKW)
Brickworks engages in the manufacture and distribution of building products, supplying bricks, pavers, roofing, and industrial materials.
It has a strong domestic presence and a growing North American footprint.
So far in 2025 its share price has risen an impressive 30.53%.
This was influenced by strong revenue in H1 25 for this ASX materials share.
For the first half of 2025, Brickworks reported an underlying net profit after tax of $76 million, significantly improving from a loss of $37 million in the prior corresponding period. Statutory net profit after tax was $21 million.
The company could be set to benefit from the rise in dwelling commencements because increased housing and apartment construction directly boosts demand for building materials, improving volumes and margins across its national operations.
James Hardie Industries PLC (ASX: JHX)
James Hardie Industries is the world's leading producer and marketer of fibre cement building products.
Its share price has fallen 20.67% so far this year.
However broker Bell Potter sees a turnaround on the horizon, with a "buy" recommendation and $63.00 price target on this ASX materials share.
This suggests 59.9% upside from its current price.
The company could benefit from rising building activity in Australia, which could boost demand for its fiber cement products used in new homes and multi-residential buildings.
With operational leverage and growing builder preference for durable, low-maintenance materials, increased construction activity supports stronger local volumes and margin expansion.
